The Unassuming Economist

From a paper by Domingo Rodríguez Benavides, Nancy Muller Durán, and Ignacio Perrotini Hernández:

“The relationship between fluctuations of the unemployment rate and the growth rate of output (Okun’s Law) in Mexico, the United States (US) and Canada during the period 2006-2019 is dealt with in the present paper. We posit the hypothesis that cyclical shocks can permanently affect structural unemployment. A non-linear autorregresive distributive lag (NARDL) model is displayed to test the assumption of symmetric effects in Okun´s Law analysis. Our econometric results suggest that while in the US and Canada there is evidence of an asymmetric Okun’s Law in the short run and the long-term, respectively, for the case of Mexico no such evidence exists. These discrepancies speak to the relevance of looking at the existence of non- linear effects in Okun´s Law. The accurate identification of such effects can shed light for both labour market reforms and stabilization policy design.”

From a paper by Virender Kumar, Simran:

“Globalization in the form of increased trade, technological advancements, and capital flows has spurred economic growth and lifted millions out of poverty across Asia, but these advantages have not been equally distributed, leading to income inequality. While previous research has highlighted globalization’s role in income inequality, little attention has been given to the moderating role of financial development. As Asian economies become more integrated into the global system, understanding how financial development mediates effects of globalization on income disparity has become crucial for policymakers, researchers, and practitioners. This study empirically investigates how financial development shapes the impact of globalization (trade, technological, and financial) on income inequality in Asian countries. Using a fixed effect panel data model with data for 22 Asian countries, we show that while all three modes of globalization—trade, technological and financial—aggravate the income gap, the influence of these types of globalization on income inequality is reduced when financial development takes place. In particular, the study finds that if a country is financially developed, the net effect of all types of globalization on income inequality is negative, meaning that in a financially developed country, globalization may actually help reduce income inequality. In response to these findings, we suggest policy recommendations, including increasing access to banking services and promoting financial literacy for financial inclusion, prioritizing sectors with high job creation potential, and providing reskilling support for globalization.”

From a paper by Mahdi Shahrazi, Saman Ghaderi & Bahram Sanginabadi:

“The potential influence of global commodity prices on consumer price inflation has been a concern of researchers and policymakers for decades. Even though a body of literature has investigated such connections, the results are mixed. This study uses a structural vector autoregressive (SVAR) model to investigate the impact of global commodity prices on Iran’s inflation over the 2009:1-2018:11 period. We have included commodity price, exchange rate, and stock returns as explanatory variables in our model. Based on the findings of our long-run multiplier matrix the response of inflation to the commodity price shocks is positive and statistically significant. In other words, global commodity prices increase Iranian inflation. Also, the results suggest that the explanatory power of commodity price shocks in inflation fluctuations is higher than those of exchange rate and stock returns in the long run.”

From a paper by Danijela Lazović Vuković, and Jože P. Damijan:

“This paper studies the drivers of rising income inequality in OECD countries between 1980 and 2018. By testing Milanovic’s TOP hypothesis in our sample, we measure the extent to which these distributional outcomes have been driven by either technological progress or globalization and the extent to which they have been influenced or mitigated by policy choices. The results of our empirical analysis provide the basis for confirming the TOP hypothesis. We find evidence that a 10 percent increase in trade openness, financial globalization, and technological progress is on average associated with a 0.4 percent, 0.3 percent, and 0.9 percent change in market inequality, respectively. At the same time, policies such as public expenditure on education, employment protection legislation and direct income taxes promote a more equal distribution. Our most notable finding, however, is that policies not only have a direct equalizing effect, but also mitigate the effects of globalization and technological progress on income inequality. The results of our study suggest that there are reasonable alternatives to anti-globalization strategies and that redistributive and labor market policies can be tailored to control inequality in the era of globalization and technology.”

On cross-country:

• Why holiday rentals are winning the war for Europe’s city centres. Residents of tourist hotspots have long demanded that Airbnb-style letting platforms be banned. But booking numbers in Europe — and housing costs — are still rising – FT
• Recent surges in house prices have affected many — but not all — countries in the European Union – Our World in Data

Working papers and conferences:

• Macroprudential and monetary policy tightening: more than a double whammy? – BIS
• Selected Macroeconomic and Social Aspects of Housing Affordability – Intereconomics
• Housing Supply and Housing Affordability – NBER
• Does Homeownership Matter? The Long-Term Consequences of Losing a House during the Great Recession – NBER
• Reexamining Lackluster Productivity Growth in Construction – Regional Science and Urban Economics
• Credit supply, housing demand, and rising home prices. A change in veteran home loans can help explain home price dynamics – Minneapolis Fed
• Industrical Organization of Housing Markets, Fall 2025 – NBER

On Australia and New Zealand:

• [Australia] Could Trump’s tariffs lead to another house price boom in Australia? Sharemarket volatility and fear of recession can scare property investors, but lower borrowing rates may push up home values – The Guardian
• [Australia] Australia’s looming election brings housing crisis into focus – BBC
• [Australia] Election cons will fuel higher house prices and debt – Financial Review
• [Australia] The housing policies of both major parties are bad for Australia’s aspiring homebuyers. The plans would exacerbate the problem they say they are trying to solve – rising property prices – The Guardian
• [Australia] Leaders brush off warnings from economists that duelling housing policies will drive up prices in Australia. Neither Anthony Albanese nor Peter Dutton say they want house prices to fall, as experts warn new promises could worsen affordability crisis – The Guardian
• [Australia] Home ownership is slipping out of reach for many Australians. Will the major parties’ promises make a difference? Neither Labor nor the Coalition’s policies will solve the housing crisis. At least they are competing over who can get the most homes built – The Guardian
• [Australia] Australia does not have enough tradies to fulfill Labor’s housing promise, experts say. Construction industry already faces shortfall of 80,000 workers as government vows to build 250,000 homes a year for four years – The Guardian
• [Australia] Why is it so hard for everyone to have a house in Australia? – The Conversation
• [Australia] Liberals want house prices to grow slower than wages – Financial Review
• [Australia] Not enough houses are being built in Australia, and Labor has promised 1.2m more. Here’s what needs to happen. ABS data shows current rates of construction unlikely to meet government’s five-year Housing Accord target – or estimates of demand – The Guardian
• [Australia] Why working hard no longer buys you a home in Australia. We need to end the federalism disconnect and enable states to strip away their own government-imposed costs on new housing. – Financial Review
• [Australia] Australia’s housing policy looks to fix symptom, not cause – Oxford Economics  
• [Australia] Excuse my cynicism, but after 25 years of the same housing policies, could Australian leaders try something else? First homeowners’ grants have long been the go-to policy by state and federal governments. And yet here we are in 2025 with a worsening housing affordability crisis – The Guardian
• [Australia] How Australia’s Housing Market Became So Out of Reach. Ballooning property prices and rents are causing serious housing affordability problems in Australia. So how bad is it? And how did it get to this point? – Bloomberg
• [Australia] Adelaide becomes fifth Australian capital where median house value exceeds $1m. Across Australia, home prices grew at slowest rate in two years and unit prices fell in March, Domain says – The Guardian
• [Australia] Half of Australian landlords sell their investments after 2 years, adding to renters’ insecurity – The Conversation
• [New Zealand] House prices down, listings up: Why Real Estate Institute is feeling positive – RNZ

On other countries:  

• [Canada] Canadians Are Cashing Out Their American Vacation Homes. Political uncertainty, coupled with a weak Canadian dollar, is driving owners to sell properties they’ve had for decades – Wall Street Journal
• [Canada] Stressed and Sidelined Homebuyers Start to Strain Canada Economy – Bloomberg
• [Canada] Housing starts for March 2025 – CMHC
• [Canada] Canada: Housing prices continue to fall in March – National Bank of Canada
• [India] Q1 home sales dip 19%, less than 1 lakh residential units sold in Jan-March. Against the backdrop of worsening geopolitical concerns that can deeply impact the domestic job market, sales fell in all key residential markets except Bengaluru and Chennai – Business Standard
• [Ireland] House prices now nearly 20% higher than at peak of pre-crash property bubble in 2007. Some 3,245 dwellings were purchased in February, down 14 per cent from January, CSO says – The Irish Times
• [Singapore] Singapore Home Sales Cool as Tariffs Threaten Market Rally – Bloomberg
• [United Kingdom] Barclays joins other lenders to cut mortgage rate below 4%. Brokers warn some lenders might be slow to pass on lower prices due to uncertainty around trade policy – FT
• [United Kingdom] Tariff turbulence: Our first thoughts on what this means for the UK housing market – Savills
• [United Kingdom] The UK’s Housing Affordability Crisis is Easing. It may not feel like it, but houses in the UK are steadily becoming more affordable. – Bloomberg
• [United Kingdom] UK property asking prices up 1.3% on year, Rightmove says – Reuters
• [United Kingdom] London Property Faces Hit From Trade War, Rightmove Says – Bloomberg
• [United Kingdom] UK house prices rose by most in over two years in February, official data shows – Reuters