Suchergebnisse

The paper studies the labor share among countries of the European Union, with a particular attention to newer member states of Central and Eastern Europe (CEEU). After discussing methodological issues in the computation of the labor share, we present various stylized facts at the country level, and also for broad sectors within the aggregate economy. We find that CEEU countries typically have lower labor shares, both in the aggregate and at the sectoral level. Structural change, while quite pronounced among the CEEU economies, plays only a minor role in the evolution of the labor share. The exception is agriculture, which for some countries have a sizable impact on the level and dynamics of the labor share - partly because of important measurement problems. We also document links between productivity, the relative prices of consumption and investment, and the labor share. In particular, we find that a significant part of the difference in conventionally measured labor shares between the more developed EU countries and less developed CEEU countries can be attributed to differences in relative prices. We discuss possible explanations, and show that given reasonable assumptions, a simple two-sector model is able to account for the main findings.

In this paper we analyze the bank lending channel in Hungary. We provide a brief overview of the theory and the empirical approaches used to investigate the existence of bank lending channel. From the possible methods we use the generally applied approach suggested by Kahsyap and Stein (1995) which relies on discovering asymmetries in changes in the amount of loans to monetary actions in order to isolate supply and demand effects. We estimate an ARDL model where the asymmetric effects are captured by interaction-terms. We find significant asymmetric adjustment of loan quantities along certain bank characteristics. The existence of bank lending channel, and therefore loan supply decisions of banks, can explain these asymmetries. In addition, we do not find any sign for asymmetric loan demand adjustment along these variables. According to these findings, we cannot rule out the existence of the bank lending channel in Hungary.

AbstractThis paper evaluates a 90‐day hiring subsidy designed for young jobseekers aged below 25, introduced in Hungary in 2015 as part of the Youth Guarantee programme. The subsidy covers the total wage cost with no obligation to retain the new hire when the subsidy expires. The analysis is based on linked administrative data on registered unemployment, cognitive skills measured around age 15, healthcare, and social security records. The causal impact of the subsidy on subsequent employment is identified in comparison to participants of a uniquely large public works programme, using propensity score matching with exceptionally rich controls. The estimates indicate significant positive effects: participants spent 14–20 days more in employment within 6 months after the programme ended in the whole sample. The impact is weaker on the 12‐month horizon. We find that the subsidy works well as a screening device: the programme has the highest impact on youths who have very low levels of schooling (8 years of primary school or less), but scored high on cognitive skills tests. One potential explanation is that employers tend to retain those with better cognitive skills, irrespective of their formal qualifications. We also find some indication that the subsidy is (mis)used by some employers to hire short term, seasonal workers.

This paper provides an overview of the impact of unconventional central bank instruments, the relevant international experiences and the room for application in Hungary. The use of unconventional instruments may be justified by the existence of financial market friction, turmoil, failure or constraint, when instruments that change the size and/or composition of central bank balance sheets may be more efficient in achieving monetary policy objectives than traditional interest rate policy. Empirical analyses found the unconventional instruments applied in developed countries successful in easing market tensions, increasing market liquidity and reducing yields. Although they proved to be unsuccessful in providing a boost to economic growth, they were able to mitigate the fall in lending and output. Vulnerable emerging countries with a lower credit rating and high external debt have much less room for manoeuvre to apply non-conventional instruments. Even liquidity providing instruments, which are otherwise considered the least risky, may result in exchange rate depreciation and flight of capital during a crisis. The interventions that involve risk taking by the government may add to market concerns about fiscal sustainability. Due to Hungary's vulnerability, high country risk premium and large foreign exchange exposure, most of the instruments applied in other countries would entail financial stability risks at home. In theory, the sharp reduction in the supply of bank credit could provide sound justification for the use of unconventional central bank instruments in Hungary. It should be noted, however, that insufficient credit supply is mainly attributable to a lack of willingness by banks to lend, which can be less influenced by the Bank, rather than to any lack of capacity to lend. In addition to banks' high risk aversion, uncertain macroeconomic environment and economic policy measures affecting the banking sector also decreased willingness to lend, which is beyond the authority of the central bank. Therefore, these instruments at most may have a role in preventing a possible future deterioration in banks' lending capacity from becoming an obstacle to lending in a turbulent period.