Republican-leaning economists tend to predict stronger economic growth when a Republican is president than Democrats do – and because of this partisan optimism, their forecasts end up being less accurate.
BearFotos/ShutterstockAmerican voters often rank inflation as the most important issue facing the US. But something odd has happened to inflationary expectations since Donald Trump became president in January. Americans believe inflation is much higher than it is, and are bracing themselves for further increases.
In his first real electoral test since sweeping to power in October 2023, the party of Argentina’s right-wing populist president, Javier Milei, has suffered a landslide defeat. The result can be read as an emphatic reminder of the remarkable endurance in Argentina of Peronism – the movement named after former president Juan Perón.
This paper examines how structural change in labor markets affects household credit outcomes. Using a Shift-Share instrumental variable approach, we find that occupational shifts negatively influence mortgage holding for households facing fa-vorable job market conditions, such as stable employment and income growth. Our results, robust to alternative specifications, suggest that when both individual and economy-wide career prospects are favorable, the opportunity costs of settling down grow accordingly.
Announcing a large fiscal stimulus may signal the government’s pessimism about the severity of a recession to the private sector, impairing the stabilizing effects of the policy. Using a theoretical model, we show that these signaling effects occur when the stimulus exceeds expectations and are more noticeable during periods of high economic uncertainty. Analysis of a new dataset of daily stock prices and fiscal news in Japan supports these predictions.
Last week’s immigration operation at a battery plant highlighted a tactic that companies use to bring in foreign workers to establish new operations.
Commerce Secretary Howard Lutnick has been putting the squeeze on companies and trading partners in an unusual effort to raise revenue and expand the president’s role over the economy.
CandyBox Images/ShutterstockAfter the resignation of Angela Rayner, the UK government faces an urgent question: what will happen to its flagship employment rights bill?
The majority of Gaza's urban sites will have to be rebuilt from the ground up. Anas-Mohammed/ShutterstockThe US and Israel have sparked international condemnation over their leaked vision for the reconstruction of a shattered Gaza. The urban development plan seems to have evolved since its emergence earlier in the year.
In contrast to the conventional Fisherian view that inflation reduces real debt positions, we show that significant increases in inflation are strongly associated with financial crises. In the spirit of Jordà et al. (2020), countries with free and fixed ex-change rates can be compared to difference out the confounding reaction of monetary policy. Across a dataset of 18 advanced economies over 151 years, we show that the impact of inflation extends beyond its indirect effect via monetary policy.
