The Unassuming Economist

From a paper by Andre Harrison & Jeremy Viele:

“We use a structural vector autoregressive (SVAR) model to study the effects of oil market shocks on US labor productivity and employment hours, where identification occurs through a combination of short- and long-run exclusion restrictions. The results show that labor productivity is responsive to all sides of the oil market, with employment hours responding only to demand-side forces. Further, oil market shocks explain roughly 25% of the long-run variation in both variables. Among oil market shocks, oil-specific demand shocks contribute to most of the historical fluctuations in labor productivity, while aggregate demand shocks matter most for fluctuations in employment hours.”

From a paper by Nezir Köse, and Emre Ünal:

“This study analyzes the impact of the oil price on income inequality in five major oil-exporting economies: Iran, Kazakhstan, Nigeria, Russia, and Venezuela. Utilizing a panel cointegration approach alongside a country-specific SVAR framework, this research examines both the short- and long-run dynamics of the Gini coefficient to determine whether resource dependence shapes distributional outcomes. The empirical results reveal a significant, albeit modest, long-run relationship where sustained increases in the oil price contribute to reducing income inequality. However, the panel estimation finds no significant short-run effect, suggesting that immediate price shocks do not instantly alter distributional structures. The SVAR analysis uncovers substantial cross-country heterogeneity that aggregate models overlook. Variance decomposition indicates that oil price shocks account for a substantial share of inequality dynamics in Kazakhstan and Nigeria, whereas Russia, Iran, and Venezuela exhibit distinct structural adjustment patterns that implicitly reflect their macroeconomic and institutional architectures. Furthermore, GDP per capita demonstrates a consistent influence across both time horizons, underscoring the vital role of broader economic performance. These findings suggest that while oil revenues can act as a long-run stabilizing buffer, they are insufficient as a standalone solution. Consequently, policymakers should prioritize economic diversification and institutional reforms to foster more resilient, equitable growth trajectories independent of volatile global commodity cycles.”

From a paper by Galina Hale, Michael Halling, Nora Alice. Paulus, and Han H.G. Pham:

“Limiting global warming to 1.5 degrees requires that cumulative carbon dioxide emissions remain
within a finite remaining carbon budget. How this budget is allocated across countries raises
questions of fairness and development. This paper evaluates whether equity-based carbon
allocations are compatible with sustained economic growth in emerging and developing economies.
We compute country-level fair shares of the remaining carbon budget under the equal-cumulativeper-
capita (ECPC) principle. Using data for 162 countries between 1950 and 2023, we then estimate
the historical relationship between income and per-capita CO2 emissions across income groups and
use these elasticities to simulate cumulative emissions until 2050. Our results show that ECPC
implies strongly negative remaining carbon budgets for most advanced economies, while lowerincome
countries retain positive but constrained allocations. Under historically observed income–
emissions elasticities, many developing countries would exceed their fair shares when converging
toward advanced-economy income levels. At the aggregate level, unused allocations offset only
17% of the combined carbon budget shortfall implied by countries exceeding their allocation and
the negative fair shares arising from historical responsibilities. In a scenario in which we assume
that the technology of advanced economies is transferred to all countries, the carbon budget
coverage increases to 38%.”

From a paper by Dániel Szilágyi and Tímea Kocsis:

“The paper examines the relationship between economic growth and greenhouse gas (GHG) emissions in Hungary from 1995 to 2022 using the Tapio decoupling model and the Mann-Kendall trend test. The Tapio decoupling elasticity coefficient (DI) was used to assess the relation between economic activity and environmental impact. The Mann-Kendall trend test was used to detect monotonic trends in Gross Value Added (GVA) and emissions, revealing their statistical significance and direction of change. The results revealed varying decoupling trends across various sectors. Strong decoupling occurred in sectors like B, C, D, and E, where emissions decreased alongside economic growth, reflecting technological advancements and structural shifts. Weak decoupling was observed in sectors such as A, F, G, and Q, where emissions grew more slowly than GVA, indicating progress but falling short of full decoupling. Conversely, sector T exhibited expansive negative decoupling, revealing unsustainable growth. At the national level, data from recent years have shown a trend toward absolute decoupling, in which GVA grew as emissions stabilized or declined. The Mann-Kendall test confirmed consistent economic growth across all sectors but diverse emission trends. Sectors like B and E achieved significant reductions in emissions, while others, including A and T, recorded increases. Some sectors, like I and M, displayed no clear trends, influenced by external or sector-specific factors.”

From a paper by J. Mikael Malmaeus, Linn Andreou Brolin, Pernilla Hagbert, Åsa Nyblom, Mirjam Särnbratt, Johan Rootzén:

“Current strategies to reduce the climate impact of production and consumption are insufficient to meet the pressing targets of the Paris Agreement. To expand visions of the possible ‘solution space’ in climate transitions, we explore a framework based on two dichotomies centred around the role of labour and the composition of economic output. From these dichotomies we sketch out four pathways for a future low-carbon society: Green growth, Care economy, Degrowth and Green accelerationism. Using a stylized representation of the Swedish economy as a case, we explore possible changes in the economic structure following the different pathways with respect to labour inputs, production volumes, GHG emissions and resource use in different sectors. The pathways suggest different strategies and overarching logics for decarbonisation. The results indicate that the technological emphasis in prevalent green growth strategies is not sufficient to stay within a carbon budget in line with the Paris agreement. Depending on the pathway taken, the upholding of social welfare, reassessing the role of labour and shifting production and consumption patterns become key challenges. Overall, key insights indicate that swift, radical transformation can advance climate goal attainment but also demands major societal reorganisation. The results also illustrate how the different transformation pathways entail distinct trade-offs, each associated with its own set of advantages and challenges.”