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Amol Agrawal

Amol Agrawal

I am currently pursuing my PhD in economics. I have work-ex of nearly 10 years with most of those years spent figuring economic research in Mumbai’s financial sector.

Articles by Amol Agrawal

The Effectiveness of Job-Retention Schemes during the pandemic: Evidence from Germany

2 days ago

Shekhar Aiyar and Mai Chi Dao in this IMF paper evaluate the effectiveness of Germany’s short-term work programme during the pandemic:
Kurzarbeit (KA), Germany’s short-time work program, is widely credited with saving jobs and supporting domestic demand during the COVID-19 recession. We quantify the impact by exploiting state-level variation in exposure to the pandemic shock and KA take-up. We construct a shift-share measure of the labor demand shock and instrument KA take-up using the pre-existing, state-specific share of workers eligible for KA. We find, first, that KA was crucial in mitigating unemployment: absent its expansion the unemployment rate would have increased by an additional 3 pp on average at the trough of the recession. Second, KA also bolstered domestic demand: the

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Ageing and the real interest rate in Japan: A labour market channel

2 days ago

Shigeru Fujita and Ippei Fujiwara in this voxeu research:

The Japanese economy has experienced a prolonged slowdown in growth and persistent declines in the real interest rate, while at the same time the country’s labour force has been rapidly ageing. This column explores a novel causal link between the ageing labour force and the low-frequency declining trend in the real interest rate since the 1970s, and suggests that the ageing of the labour force accounts for 40% or more of the declines in the real interest rate observed between the 1980s and 2000s in Japan.

This entry was posted on October 14, 2021 at 7:08 pm and is filed under Academic research & research papers, Economics – macro, micro etc, Financial Markets/ Finance.

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Denmark Central Bank’s Gold – A historical overview

2 days ago

Nice historical analysis of role of Gold in Denmark’s monetary system from a historical perspective. The short paper is written by Kim Abidgren.

There is still public interest in Danmarks Nationalbank’s gold stock, although it has been many years since gold played an important role in the cash system and more generally in monetary and foreign exchange policies. The analysis provides an overview of the historical background of the gold stock based on source material from Danmarks Nationalbank’s archives at the Danish National Archives.

This entry was posted on October 14, 2021 at 5:27 pm and is filed under Academic research & research papers, Central Banks / Monetary Policy, Economics – macro, micro etc, Financial

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Should Keynes’s General Theory book have been titled instead as ‘Special Theory of Employment, Interest and Money’?

3 days ago

I had pointed that Monetary Authority of Singapore has completed its 50 years in 1971 and the central bank has released a commemorative volume on its 50 years.
In the volume there is a speech (page 8-13) by Dr Goh Keng Swee who was chair of MAS from 1980 to 1985.
He reflects on his college days when he studied economics and Keynes released the General Theory:
When I was studying economics at Raffles College in pre-War days, the Keynesian revolution broke out with the publication of John Keynes’The General Theory of Employment, Interest and Money. Today, critics, including Sir John Hicks, are agreed that it was a badly written work and made for difficult reading. I can attest to the latter. As an undergraduate, I read the book from cover to cover no fewer than three times, some

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The Fed’s Evolving Involvement in the Repo Markets

3 days ago

Huberto M. Ennis and Jeff Huther in this Richmond Fed paper look at ongoing changes in Fed’s monetary policy framework:
The Fed recently introduced a new monetary policy tool — the Standing Repo Facility — which complements the Overnight Reverse Repo program put in place in 2013. We provide an overview of the workings of these two initiatives and their effects on the repo market, with thoughts about the way they affect the dynamics of this critical segment of the financial system.

This entry was posted on October 13, 2021 at 6:42 pm and is filed under Academic research & research papers, Central Banks / Monetary Policy, Economics – macro, micro etc. You can follow any responses to this entry through the RSS 2.0 feed.

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The impact of the euro on trade: two decades into monetary union

4 days ago

Team of 5 ECB economists (Vanessa Gunnella, Laura Lebastard, Paloma Lopez-Garcia, Roberta Serafini and Alessandro Zona Mattioli) in this paper assess the impact of Euro on trade:
The consensus back in 2008 – ten years after the introduction of the euro – was that the adoption of a common currency had made a limited impact of around 2% in total on the trade flows of the first wave of euro area countries (Baldwin et al., 2008). Since then, six more countries have joined the euro area, and firms have internationalised their production processes. These two phenomena are interrelated and may have changed the way the common currency affects the euro area economy. Therefore, with the common currency now into its third decade – and with more countries queuing to adopt it – this paper revisits

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Explainer: Nobel Economics Prize of 2021

4 days ago

The Nobel Prize in Economics for 2021 has been awarded to three economists: David Card, Guido Imbens and Joshua Angrist.
My article in Moneycontrol attempts to explain their work which led the Nobel Committee to award them the coveted economics prize.

This entry was posted on October 12, 2021 at 4:09 pm and is filed under Academic research & research papers, Economics – macro, micro etc, Economist. You can follow any responses to this entry through the RSS 2.0 feed.
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Thorstein Veblen’s Theory of the Leisure Class—Evolution from leisure class to luxury belief class

5 days ago

Rob Henderson (PhD candidate at the University of Cambridge) in this article updates Veblen’s leisure class:
Thorstein Veblen’s famous “leisure class” has evolved into the “luxury belief class.” Veblen, an economist and sociologist, made his observations about social class in the late nineteenth century. He compiled his observations in his classic work, The Theory of the Leisure Class. A key idea is that because we can’t be certain of the financial standing of other people, a good way to size up their means is to see whether they can afford to waste money on goods and leisure. This explains why status symbols are so often difficult to obtain and costly to purchase. These include goods such as delicate and restrictive clothing like tuxedos and evening gowns, or expensive and

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Left and right: Examining the evolution of political ideologies with Prof Pranab Bardhan

5 days ago

Interesting conversation between Prof Pranab Bardhan and Ashok Kotwal of IdeasforIndia.in
With the advent of globalisation, the struggle between the ‘left’ and ‘right’ – as defined in Marxian terms – rapidly evolved from one between economic ideologies, to cultural wars. In this context, I4I Editor-in-Chief Ashok Kotwal engages in a deep-dive with Prof. Pranab Bardhan (University of California, Berkeley) on issues ranging from growing resentment towards educated elite, shifts in the form of capital and employment patterns, role of communities, to emergence of illiberal political movements, and the different types of nationalism and populism.

This entry was posted on October 11, 2021 at 2:06 pm and is filed under Academic research &

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Could cars become mobile wallets?

5 days ago

Sirish Kumar, former CFO of Paypal (India and ASEAN region) in this OMFIF article points to ongoing technological changes in banking. As banks are under pressure from fintechs in their banking business, the banks need to look at facilitating online businesses:
Winds of disruption seen in consumer payments and retail banking are heavier than ever in banks’ wholesale payments and cash management business, which generates annual revenues of more than $250bn. This business provides payments solutions for suppliers and liquidity management for treasurers.
Until recently, banks as incumbents have enjoyed returns on equity of 20% to 40% and have leveraged this business as an anchor for large corporate relationships (with opportunities for cross-selling). Fintechs and other non-banks have

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Reserve Bank of NZ adds two more assistant governors for addressing new challenges

8 days ago

Central banks like all other organisations respond to challenges by creating new roles and divisions.
Reserve Bank of NZ has done the same. So far, the central bank had 1 Governor, 1 deputy governor and 5 assistant governors looking at various roles.
It has created two new assistant governor positions: 1) Risk, Compliance & Legal Services and 2) Information and Data Analytics. 
Governor Adrian Orr says the Reserve Bank is well advanced in its transformation to meet its new mandate. “We are aware of our future governance expectations under new legislation. We’re strengthening our foundations and how we operate.”
The changes will result in the Senior Leadership Team expanding from six to eight roles. The additional roles are the General Managers of ‘Risk, Compliance and Legal Services’

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50 years of Monetary Authority of Singapore: 50 Landmark Statements by MAS Leaders

8 days ago

This blog had pointed to the 50th anniversary of Monetary Authority of Singapore.
MAS has announced series of events to commemorate the event.  The central bank has also released this exciting volume of 50 Landmark Statements by MAS Leaders. Chairperson’s statement (hightime the organisations replace the word chairman with chairperson):

The Monetary Authority of Singapore (MAS) is not often in the public eye. It has however played a critical role in Singapore’s economic development, keeping inflation low to support sustained economic growth, preserving financial stability and trust, advancing the development of a global financial centre, and judiciously managing a significant component of Singapore’s reserves. 
This 50th anniversary compilation provides convenient access to the

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Explained | The saga of the US Debt Ceiling crisis and $1 trillion coin

9 days ago

My new piece explaining the linkages between US debt ceiling crisis and US Dollar 1 trillion coin.
The US government has run into a debt ceiling crisis once again. A few economists have suggested that the US government could mint a platinum coin worth $1 trillion to resolve the crisis.
What exactly is the debt ceiling crisis and how would the coin help resolve the crisis? Here is a primer to explain these two issues.

This entry was posted on October 7, 2021 at 12:38 pm and is filed under Academic research & research papers, Central Banks / Monetary Policy, Economics – macro, micro etc. You can follow any responses to this entry through the RSS 2.0 feed.
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Scapegoating of ethnic minorities: Experimental evidence from Eastern Slovakia

10 days ago

Team of researchers (Michal Bauer, Jana Cahlíková, Julie Chytilová, Gérard Roland, Tomáš Želinský) in this voxeu research:
Scapegoating refers to a social phenomenon whereby members of an aggrieved majority group retaliate against innocent third parties, usually members of vulnerable minority groups. This column uses an experiment set up between May and September 2017 in Eastern Slovakia – where a large Roma minority regularly suffers from discrimination – to measure how an injustice that affects a member of one’s own group shapes the punishment of an unconnected bystander (or scapegoat). The experiment shows that members of a majority group will systematically shift punishment onto innocent members of an ethnic minority. 
….
Our evidence of the scapegoating behaviour has several

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Reading the economic history of Aghanistan

10 days ago

Prof Tirthankar Roy of LSE in this interesting paper discusses economic history Afghanistan:
Twentieth-century Afghanistan offers a lesson for the historian of comparative economic development. Two conditions help to understand Afghan history better, resource poverty and the absence of European colonial rule. In a resource-poor region, the possibility of rapid economic change depends to a great extent on the capability and stability of the states; at the same time, attempts to create strong centres of power with a weak tax base can generate debilitating conflicts. European colonialists in some cases managed to overcome the dilemma. In the absence of colonialism, old elites and old rivalries survived and intensified the conflict. These two features appeared in the histories of many of

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Germany 1871: Nation building and the transition to modern economic growth

11 days ago

2021 marks yet another anniversary. January of 2021 marked the 150th anniversary of the first unified state in modern German history.
Eh.net reviews a new book that reflects on this landmark anniversary:
January of 2021 marked the 150th anniversary of the first unified state in modern German history. For political and diplomatic historians the 1871 Empire (Reich) has long served as a milestone. For economic historians 1871 has held less significance. Some major institutions of German economic integration preceded the Reich. The Customs Union (Zollverein), which included nearly all of the states that later formed the Reich, dates to 1834. Most German states had adopted a common business code in 1861. Other institutions important to economic integration came long after 1871; for

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Stock Exchanges as Lighthouses

11 days ago

Came across this 2014 paper by Philip Booth of Cass Business School. He looks at history of stock exchanges and how they evolved not via government regulation but by private coordination. In several ways this is how lighthouses also evolved as pointed by Ronald Coase.
Over the years, it has frequently been argued by economists that lighthouses need to be provided by the state. Ronald Coase demonstrated, in fact, that they could be provided privately. The same is true of financial regulation. Though many economists, using blackboard economics, argue that financial markets need to be regulated by the state, it is found that regulatory mechanisms evolve in the market which are effective and stable. It is feasible that a central bank could also evolve as a private institution to regulate

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Central bank communication with non-experts: Role of Twitter

11 days ago

Michael Ehrmann and Alena Wabitsch in this ECB paper see the role Twitter has played in central bank communications with non-experts:
Central banks have intensified their communication with non-experts – an endeavour which some have argued is bound to fail. This paper studies English and German Twitter traffic about the ECB to understand whether its communication is received by non-experts and how it affects their views. It shows that Twitter traffic is responsive to ECB communication, also for non-experts. For several ECB communication events, Twitter constitutes primarily a channel to relay information: tweets become more factual and the views expressed more moderate and homogeneous.
Other communication events, such as former President Draghi’s “Whatever it takes” statement, trigger

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RBI supersession of Board of Directors of SREI Infrastructure Finance and SREI Equipment Finance

12 days ago

India’s financial sector mess continues. Markets had long expected SREI Infra Finance to go under and this has indeed happened.
RBI has superseded the Board of two SREI companies:
In exercise of the powers conferred under Section 45-IE (1) of the Reserve Bank of India Act, 1934, the Reserve Bank has today superseded the Board of Directors of Srei Infrastructure Finance Limited (SIFL) and Srei Equipment Finance Limited (SEFL), owing to governance concerns and defaults by the aforesaid companies in meeting their various payment obligations. Shri Rajneesh Sharma, Ex- Chief General Manager, Bank of Baroda has been appointed as the Administrator of the aforesaid companies under Section 45-IE (2) of the RBI Act.
The Reserve Bank also intends to shortly initiate the process of resolution of

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5 years of Insolvency and Bankruptcy Code – 2

12 days ago

The Insolvency and Bankruptcy Board of India was established on 1st October, 2016 under the Insolvency and Bankruptcy Code, 2016 (Code).
IBC and IBBI celebrated 5 years recently. IBBI released several documents/videos to mark the occasion:
e-Book: Insolvency and Bankruptcy Code, 2016 – 5 years of facilitating ease of exit
Annual Publication 2021: “Quinquennial of Insolvency and Bankruptcy Code, 2016”
Fifth Annual Day Lecture by Dr. Bibek Debroy, Chairman, Economic Advisory Council to the Prime Minister: “From No Exit to Easy Exit: A Case Study of IBC”
Audio-Visual Film on Five Years of IBC
My Stamp on “Insolvency and Bankruptcy Code, 2016” released by Department of Posts
Chairperson of IBBI – M.S.Sahoo – also completed his 5-year tenure. The government has not yet appointed a new

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Decrypting new age International Capital Flows via bitcoins

12 days ago

Clemens Graf von Luckner, Carmen M. Reinhart & Kenneth S. Rogoff in this NBER paper analyse capital inflows via a bitcoin exchange. They find that bitcoins are being used significantly in foreign capital inflows:

This paper employs high frequency transactions data on the world’s oldest and most extensive centralized peer-to-peer Bitcoin market, which enables trade in the currencies of more than 135 countries. We develop an algorithm that allows, with high probability, the detection of “crypto vehicle transactions” in which crypto currency is used to move capital across borders or facilitate domestic transactions.
In contrast to previous work which has used “on-chain” data, our approach enables one to investigate parts of the vastly larger pool of “off-chain” transactions.
We find

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Ideas of Adam Smith and how they apply to India

12 days ago

In this superb podcast, Shruti Rajagopalan and Pratap Bhanu Mehta discuss the ideas of Adam Smith and how they apply to India. There is a transcript of the conversation as well.
Mehta’s PhD dissertation was on Adam Smith. Shruti nicely weaves the coversation around how/whether Smith is relevant for India and under what setting. So many threads here..

This entry was posted on October 4, 2021 at 10:39 am and is filed under Academic research & research papers, Discussion, Indian Economy/Financial Markets. You can follow any responses to this entry through the RSS 2.0 feed.
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Doing Business Rankings once again question the US-Europe dominance of Bretton Woods institutions

15 days ago

World Bank stopping publishing of Doing Business rankings has led to fair bit of controversy. WB’s investigation report which found that the rankings were politically compromised led to WB stopping these rankings. The report has named Kristalina Georgieva then WB CEO and current IMF chief as one of the people who led to compromise of the rankings.
Georgieva immediately released a statement denying the charges:
“I disagree fundamentally with the findings and interpretations of the Investigation of Data Irregularities as it relates to my role in the World Bank’s Doing Business report of 2018. I have already had an initial briefing with the IMF’s Executive Board on this matter.”
Prof Joseph Stiglitz in this Proj Syndicate piece says that this is an attempt to remove Georgieva. He says

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20 years of Clearing Corporation of India Limited

15 days ago

CCIL was established in Apr-2001 and year 2021 marks 20 years of this organisation.
Clearing Corporation of India Limited (CCIL) has been one of the central players in development of India’s G-sec, forex and money markets.  CCIL was started to provide guaranteed clearing and settlement for transactions in G-sec, forex and money markets.
The Clearing Corporation of India Ltd. (CCIL) (CIN: U65990MH2001PLC131804) was set up in April, 2001 to provide guaranteed clearing and settlement functions for transactions in Money, G-Secs, Foreign Exchange and Derivative markets. The introduction of guaranteed clearing and settlement led to significant improvement in the market efficiency, transparency, liquidity and risk management/measurement practices in these market along with added benefits

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The demise of Doing Business: Goodhart’s Law in action

16 days ago

Thorstan Beck in this voxeu research:

The World Bank permanently suspended its Doing Business project earlier this month. This column argues that the suspension puts an end to a very useful data-collection exercise that went astray by focusing on rankings and political publicity. Beyond specific conflicts of interest within the World Bank, the demise of Doing Business reaffirms Goodhart’s Law that when an index becomes a policy target, it ceases to be a good measure.
Niranjan had also tweeted about Goodhart law in context of doing business rankings a few days ago.

This entry was posted on September 30, 2021 at 6:12 pm and is filed under Academic research & research papers, Economics – macro, micro etc, Growth and development.

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History of Urban Resilience: What happens to cities post Covid-19 shock?

16 days ago

Prof Edward Glaesar in this NBER paper reflects on how Covid-19 will impact urban locations. For this, he goes back to history of urban resilience. He is hopeful that most urban places will rebound post the covid shock.

Will COVID-19 end the urban renaissance that many cities have experienced since the 1980s? This essay selectively reviews the copious literature that now exists on the long-term impact of natural disasters. At this point, the long-run resilience of cities to many forms of physical destruction, including bombing, earthquakes and fires, has been well-documented. The destruction of human capital may leave a longer imprint, but cities have persisted through many plagues over the past millennia. By contrast, economic and political shocks, including deindustrialization or

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Climate policy is macroeconomic policy, and the implications will be significant

16 days ago

Jean Pisani-Ferry in this PIIE research says climate policy is macro policy:
For all the long-term benefits of urgently addressing climate change, economic policymakers must plan for a challenging transition to carbon neutrality. Pretending that the costs will be trivial is dangerous. Estimates by the Intergovernmental Panel on Climate Change of the United Nations indicate that emergency action is indispensable to limit catastrophic climate disruption. Because of the magnitude of the efforts involved and the pace of the transformation implied, the accelerated transition to a carbon-neutral economy is bound to have serious, immediate economic implications, warns Pisani-Ferry. Some equipment will lose economic value. Some plants will have to close. Employees will have to be reallocated

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How Emerging European Economies Found a New Monetary Policy Tool: Asset purchase programs

16 days ago

Group of IMF researchers have written this paper on how some of the Emerging European economies used asset purchases during the 2020 pandemic induced crisis. They found the asset purchases fairly effective in mitigating the crisis:
Several emerging market central banks in Europe deployed asset purchase programs (APPs) amid the 2020 pandemic. The common main goals were to address market dysfunction and impaired monetary transmission, distinct from the quantitative easing conducted by major advanced economy central banks. Likely reflecting the global nature of the crisis, these APPs defied the traditional emerging market concern of destabilizing the exchange rate or inflation expectations and instead alleviated markets successfully.
We uncover some evidence that APPs in European

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The Difference Between “Conducting” and “Implementing” Monetary Policy

17 days ago

Jane Ihrig and Scott A. Wolla in this St Louis Fed research point to the difference between conducting and implementing mon policy:
At the end of his prepared remarks at the June 16, 2021, press conference, Federal Reserve Chair Jerome Powell noted both that the Federal Reserve System (Fed) made a “technical adjustment” to its administered interest rates and that it “has no bearing on the appropriate path for the federal funds rate or stance of monetary policy.” So you might be wondering, what exactly is a technical adjustment and how is it different from the Federal Open Market Committee’s (FOMC’s) actions to adjust the stance of monetary policy? 
This technical adjustment to the Fed’s administered rates is the difference between the FOMC conducting monetary policy and the

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Explained | China’s ban on cryptocurrency

17 days ago

The People’s Bank of China recently released a notice on virtual currencies (like cryptocurrencies) which shook the global financial markets. This moneycontrol primer explains the notice and what it means for the future of virtual currencies.

This entry was posted on September 29, 2021 at 5:18 pm and is filed under Academic research & research papers, Central Banks / Monetary Policy, Economics – macro, micro etc, Financial Markets/ Finance. You can follow any responses to this entry through the RSS 2.0 feed.
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