The Unassuming Economist

From a new IMF report on Iran:

“The comparatively low share of oil exports to GDP reflects Iran’s relatively large and diversified economy. Natural resources dominate Iran’s exports representing almost 53 percent of total exports but account only for 12.3 percent of Iran’s GDP. Iran exports more products than the average of MENA countries but many of its products are closely related to the oil sector (such as plastic and rubber products).

Iran needs to expand and intensify its trade with more partners if it is to increase non-oil exports and achieve the Sixth Development Plan target of growing non-oil exports to 15 percent of GDP by 2020. Examining Iran’s main exports in three broad goods categories highlights the opportunities for Iranian non-oil exports:

• Polyethylene (top export of plastic and rubber category, representing 11.6 percent of Iran’s non-oil exports). Iran mainly exports this good to China (84 percent) and Turkey (10 percent). However, the large European market—which imported US$ 9.5 billion of polyethylene in 2015 and accounted for 35 percent of the global market — is largely underexploited.
• Car parts (top export of the transportation category, representing 0.1 percent of Iran non-oil exports). Iran mainly exports car parts to a small set of countries in Europe, namely Turkey (72 percent), France (24 percent), and Russia (3 percent).
• Pistachios (top export of the vegetable category, representing 5.9 percent of Iran non-oil exports). Iran exports pistachios to a large share of world buyers.

“Improving Iran’s export competitiveness, attracting more foreign direct investments, removing barriers to trade and developing bilateral and multilateral trade agreements would aid Iran in reaching its targets for the development of the non-oil export sector.”

Continue reading here.

On cross-country:

• Mapping the literature of ‘policy transfer’ and housing – UK Collaborative Centre for Housing Evidence
• Mapping the literature on housing taxation in the UK and other OECD countries – UK Collaborative Centre for Housing Evidence

On the US:

• Mortgage Design in an Equilibrium Model of the Housing Market – NBER
• What to Expect From the Housing Market This Spring – New York Times
• California’s Housing Prices Need to Come Down – Citylab

On other countries:

• [Canada] Toronto’s Tale of Two Markets Is Hot Condos and Cold Houses – Bloomberg
• [China] China looks to Reits to ease housing woes – Financial Times
• [China] Does Housing Unaffordability Crowd Out Elites in Chinese Superstar Cities? – Shanghai University of Finance and Economics
• [Germany] Berlin loosens law for short-term home rentals – Reuters
• [Japan] Land ho, a sign of life in Japan – Financial Times
• [Netherlands] Revolutionary housing project brings Dutch youth together with refugees – UNHCR
• [Netherlands] Airbnb rentals in Netherlands are worsening the housing crisis – Global Property Guide
• [United Kingdom] High housing costs deter workers moving to London – Financial Times
• [United Kingdom] Brexit and the City: Tracking the fortunes of London’s financial districts – Reuters
• [United Kingdom] Brexit and the City – the real estate agent’s view – Reuters

Photo by Aliis Sinisalu

A new paper from the Bank of England finds that in UK, the impact of monetary policy on inequality depends on existing difference in income and wealth.“[…] younger households are estimated to have benefited most from higher income in cash terms, while older households gained more from higher wealth.”

The paper notes that “Furceri, Loungani, and Zdzienicka (2016) emphasise the importance of heterogeneity in the response of labour income to monetary policy as a key channel, noting evidence that those at the bottom of the income distribution are most affected by changes in economic activity.” Continue reading here.

See my previous post on monetary policy and inequality here. The Furceri, Loungani, and Zdzienicka (2016) paper is available here.

A new paper from the Bank of England says that “liberalising services trade, levelling up to the liberalisation seen in goods trade, could reduce excess global imbalances by around 40%. […] The potential rewards [of services trade liberalisation] are much broader. The great prize could be reinvigorating global growth.”

The paper notes that “seminal work by Baumol (1967) underpinned the ‘classical view’ of the contribution of services to growth. This view was unambiguously negative, indicating that services were largely non-tradable and exhibited little scope for productivity improvements. But services have changed significantly since then and evidence today suggests that services are widely traded across borders (Loungani et al (2017)) and that, when services productivity is correctly measured, historical services productivity growth has been as strong as manufacturing (Young (2014)). Many studies confirm positive linkages between service sector liberalisation and economic growth. There are three aspects to this: direct benefits for the services sector, downstream benefits for production in other sectors which use services, and the potential distribution benefits from services growth.” Continue reading here.

The Loungani et al paper and our new data set on services trade are available here.

Source: Loungani et al (2017).

On cross-country:

• The Pursuit of Financial Stability and Tasks for Monetary, Regulatory, and Macro-Prudential Policies – IMF
• True Affordability: Critiquing the International Housing Affordability Survey – Victoria Transport Policy Institute

On the US:

• Affordable housing: Supply side innovation? – Rutgers Center for Real Estate
• Land-Use Regulations, Property Values, and Rents: Decomposing the Effects of the California Coastal Act – Federal Reserve Bank of Philadelphia
• For Low-Income Renters, the Affordable Housing Gap Persists – Citylab
• How Mortgage Companies Might Finally Be Held Accountable – The Nation
• Segregation Forever? Richard Rothstein speaks at the U.S. Department of Housing and Urban Development – Economic Policy Institute
• Mortgage Debt and Shadow Banks – De Nederlandsche Bank
• Housing as a hub for health, community services, and upward mobility – Brookings
• The Seven Sizzling Housing Markets – John Burns Real Estate Consulting
• The Next Housing Crisis: A Historic Shortage of New Homes – Wall Street Journal
• Spring may not be so hot for U.S. housing markets – Global Property Guide
• A housing recovery without homeowners – Federal Reserve Bank of St. Louis
• California Housing Problems Are Spilling Across Its Borders – New York Times
• Trump’s Tariffs Will Make Housing More Unaffordable – Reason
• Valuing urban land: Comparing the use of teardown and vacant land sales – Regional Science and Urban Economics
• Suburban Housing Costs Are Stretching Families to the Brink – Slate
• Commuting, Labor, and Housing Market Effects of Mass Transportation: Welfare and Identification – Federal Reserve Bank of Philadelphia
• How Do Funding and Review Processes Shape the Design of Affordable Housing? – Harvard Joint Center for Housing Studies

On other countries:

• [Canada] The Propagation of Regional Shocks in Housing Markets: Evidence from Oil Price Shocks in Canada – Bank of Canada
• [Iceland] Short-term renting of residential apartments Effects of Airbnb in the Icelandic housing market – Central Bank of Iceland
• [Switzerland] Swiss central bank warns of ‘correction’ in real estate – Financial Times
• [United Kingdom] Rethinking London’s ‘ripple effect’ on house prices: other UK regions transmit shocks too – London School of Economics
• [United Kingdom] Home Ownership Aspirations Survey – Cluttons

Photo by Aliis Sinisalu