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You are looking at 1 - 7 of 7 items for :

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Cover IMF Working Papers
Commercial Real Estate in Crisis: Evidence from Transaction-Level Data
Mr. Adrian Alter, Elizabeth M. Mahoney, and Cristian Badarinza
During the past two decades, the commercial real estate (CRE) market has been impacted by major disruptions, including the global financial crisis and the Covid-19 pandemic. Using granular data from the U.S., we document how these crises have unfolded and elaborate on the role of heterogeneity and underlying shocks. Both a set of reduced-form approaches and a structural framework suggest a prominent role for demand-side local factors in the short run, along with significant shifts in preferences during crisis episodes. However, valuations become more closely linked to macro-financial factors over the long term. A one-standard deviation tightening in financial conditions is associated with a drop of about 3% in CRE prices in the following quarter, with a stronger impact on the retail sector and milder effects in states where household indebtedness is lower.
Keywords:
Non-residential Real Estate; Financial Conditions; Liquidity; Big Data; level data; CRE price; household indebtedness; CRE market; CRE transaction; COVID-19; Real estate prices; Global financial crisis of 2008-2009; Global; Middle East and Central Asia
Cover IMF Working Papers
Demographics and the Natural Rate of Interest in Japan
Mr. Fei Han
Japan’s aging and shrinking population could lower the natural rate of interest and, together with low inflation expectations, challenge the Bank of Japan’s efforts to reflate the economy. This paper uses a semi-structural model to estimate the impact of demographics on the natural rate in Japan. We find that demographic change has a significantly negative impact on the natural rate by lowering trend potential growth. We also find that the negative impact has been increasing over time amid stronger demographic headwinds. These findings highlight the importance of boosting potential growth to offset the negative demographic impact and lift the natural rate in Japan.
Keywords:
WP; rate of interest; real interest rate; Demographic change; natural rate of interest; monetary policy; Japan; natural rate; interest rate gap; baseline estimate; core inflation; inflation expectation; Real interest rates; Population growth; Return on investment; Potential output; Global
Cover IMF Staff Country Reports
Republic of Poland: 2016 Article IV Consultation-Press Release; Staff Report; and Statement by the Executive Director for the Republic of Poland
International Monetary Fund. European Dept.
This paper describes mainly the introduction and performance of the Extended Fund Facility program for Pakistan. Since the start of the program in September 2013, economic growth has gradually recovered, inflation has fallen to low single digits, foreign reserve buffers have been rebuilt, social safety nets have been strengthened, and the fiscal deficit has significantly declined (although public debt remains high). Despite setbacks in privatization earlier in the year due to labor unrest and political opposition, the authorities remain committed to returning ailing public sector enterprises to a sound financial position, including through private participation, and to completing energy sector reform.
Keywords:
ISCR; CR; tax-free allowance; constitutional court-mandated personal income tax; PIT framework; staff appraisal; retirement age; IMF staff calculation; Inflation; Bank levy; Government finance statistics; Aging; Labor force participation; Global; Central and Eastern Europe
Cover IMF Working Papers
What Matters for Financial Development and Stability?
Raja Almarzoqi, Samy Ben Naceur, and Akshay Kotak
This study aims to identify policies that influence the development of financial institutions as measured across three dimensions: depth, efficiency, and stability. Applying the concept of the financial possibility frontier, developed by Beck & Feyen (2013) and formalized by Barajas et al (2013a), we determine key policy variables affecting the gap between actual levels of development and benchmarks predicted by structural variables. Our dynamic panel estimation shows that inflation, trade openness, institutional quality, and banking crises significantly affect financial development. Our analysis also helps identify potential complementarities and trade-offs for policy makers, based on the effect of the policy variables across the different dimensions of financial development.
Keywords:
WP; d GMM; s GMM; banking sector; standard deviation; real GDP; financial development; financial stability; financial possibility frontier; difference GMM estimator; system GMM estimator; system GMM estimation; Estimation techniques; Financial sector development; Banking crises; Commercial banks; Global
Cover IMF Working Papers
The Valuation Effects of Geographic Diversification: Evidence From U.S. Banks
Mr. Luc Laeven, Mr. Martin R. Goetz, and Mr. Ross Levine
This paper assesses the impact of the geographic diversification of bank holding company (BHC) assets across the United States on their market valuations. Using two novel identification strategies based on the dynamic process of interstate bank deregulation, we find that exogenous increases in geographic diversity reduce BHC valuations. These findings are consistent with the view that geographic diversity makes it more difficult for shareholders and creditors to monitor firm executives, allowing corporate insiders to extract larger private benefits from firms.
Keywords:
WP; BHC diversity; bank deregulation; BHC valuation; BHC assets; gravity-deregulation model; Geographic Corporate diversification; Agency problems; Economies of scope; Corporate insiders; Corporate valuation; BHC asset diversification; BHC diversification increase; Estimation techniques; Personal income; Asset valuation; Gravity models; Global
Cover IMF Working Papers
Trade Openness and Growth: Pursuing Empirical Glasnost
Mr. Andreas Billmeier and Tommaso Nannicini
Studies of the impact of trade openness on growth are based either on cross-country analysis-which lacks transparency-or case studies-which lack statistical rigor. We apply transparent econometric methods drawn from the treatment evaluation literature to make the comparison between treated (i.e., open) and control (i.e., closed) countries explicit while remaining within a unified statistical framework. First, matching estimators highlight the rather far-fetched country comparisons underlying common cross-country results. When appropriately restricting the sample, we confirm a positive and significant effect of openness on growth. Second, we apply synthetic control methods-which account for endogeneity due to unobservable heterogeneity-to countries that liberalized their trade regime and we show that trade liberalization has often had a positive effect on growth.
Keywords:
WP; control country; area dummy; country comparison; trade policy; trade openness; growth; matching estimators; synthetic control; country match; standard error; a lot of country; state monopoly; unobservable country heterogeneity; economic growth; MCD country; Latin American country; unobservable characteristic; Population growth; Trade liberalization; Public expenditure review; Middle East; Africa
Cover IMF Working Papers
Government Spending, Legislature Size, and the Executive Veto
Reza Baqir
Recent work on the political economy of fiscal policy has asked how budgetary institutions affect fiscal outcomes. But what determines the budgetary institutions? In this paper I consider one such institution: the executive veto. A simple theoretical framework predicts that jurisdictions with more political actors spending from a common pool of tax resources will choose to empower their executives. Using an econometric framework to identify the exogenous variation in the number of districts, I present evidence from a cross-section of local governments in the United States that jurisdictions with more electoral districts are likely to have executives with veto powers.
Keywords:
WP; government spending; city manager; political institutions; executive veto; council size; veto authority; mayor-council city; state indicator; city government; Personal income; Budget planning and preparation; Probit models