FDI, gravity, and aggregation: revisiting the distance elasticity with sector-level FDI data

06/15/2026 European Central Bank Central banks

This paper re-examines foreign direct investment motives in the ‘FDI gravity’ model (Kleinert and Toubal, 2010), focusing on the role of distance. More precisely, we investigate whether aggregate and pooled gravity models for FDI obscure relevant heterogeneities across sectors. This is possible through the novel MREID dataset, which provides us with FDI data at the 2-digit NAICS level for 184 countries over the period 2010 to 2020.

Financial stability considerations for monetary policy at the European Central Bank: conceptual framework and quantitative tools

06/15/2026 European Central Bank Central banks

The paper documents models used to analyse the interactions and trade-offs between price and financial stability at the European Central Bank. The paper describes a simple conceptual framework to think about the short- and medium-term trade-offs between price and financial stability. Short-term trade-offs arise whenever current inflationary pressure is high, but the financial system is experiencing stress. Medium-term trade-offs arise whenever current inflationary pressure is low, but risk is building up in the financial system.

Urban planning scandal deepens as Tsipras unveils five cost of living pledges

06/15/2026 Macropolis European Union

The rapid expansion of an urban planning corruption scandal, which has already produced arrests, resignations and fierce political recriminations; and Alexis Tsipras’s attempt to seize the initiative across the opposition spectrum with a package of five headline policy pledges aimed at easing the cost of living have set the tone for the week ahead in Greek politics.

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