AUSTRIA

Press release - European Parliament updates trans-European transport network guidelines

Retrieved on: 
Thursday, April 25, 2024

European Parliament updates trans-European transport network guidelines

Key Points: 
  • European Parliament updates trans-European transport network guidelines
    - Major transport links to finish by 2030
    - Cut transport infrastructure ties with Russia and focus on Ukraine
    - Create better conditions for military mobility along major EU roads and railways
    On Wednesday, MEPs endorsed updated plans to complete major trans-European transport projects, such as cross-border roads, railways, bridges and tunnels, by the end of 2030.
  • Major transport infrastructure projects on the core TEN-T network should be completed by the end of 2030, to secure a comprehensive network by the end of 2050.
  • Major European airports (processing more than 12 million annual passengers) will be connected to the trans-European railway network.
  • AT) said: “The regulation will enable rail transport to compete with road transport, if it is implemented as foreseen.

Mutual funds and safe government bonds: do returns matter?

Retrieved on: 
Thursday, April 25, 2024
ACT, Safe Haven, Research Papers in Economics, Flight, Policy, B.3, ICAPM, RT, Journal of International Economics, Krishnamurti, Business, CIP, International, Observation, P25, Safety, A23, Benchmarking, B.2, FX, Paper, TSD, Environment, Journal of Financial Economics, Bogdanov, Federal, Website, United, A14, Total, The Economic Journal, Eurozone, Face, G11, Quarterly Journal of Economics, Interest rate parity, History, WD, Investment, Liquidity premium, Politics, OLS, Statistics, G15, Caballero, PDF, Classification, ECB, Foreign exchange market, AC, P99, Federal funds, Froot, Lethargy, Social science, Interest, JEL, Bias, Journal, Research, Journal of Economic Literature, The Journal of Finance, E.3, Literature, Federal Reserve, Parity, European Central Bank, AA, Annual Review, Growth, Bank of England, FRED, S&P, Injection, Risk, Elasticity, Government, G12, Finance, BIS, S1, JL, E.1, Money, Depreciation, Asset, Treasury, Federal Reserve Economic Data, A11, A10, R2, Section 4, UMP, A4, Boj, Section 3, Accounting, SJ, Fed, Mutual fund, Lustig, University of Lausanne, Section 2, P75, Foreign-exchange reserves of India, Assets under management, A19, GBP, FE, American Economic Review, A22, E.5, A3, A21, Flight-to-liquidity, Aggregate demand, G23, WT, USD, Autocorrelation, CAD, UIP, Currency, XR, Quarterly Journal, Appendix H, Capital, P95, A6, Zhu, University, B.1, P50, CHF, Transmission, Swings, Estate (law), EUR, Bank for International Settlements, JPY, E.4, Central bank, Multicollinearity, Bank, Fixed effects model, Reproduction, CAP, The Atlanta Jewish Times, VIX, Data, Om, Lobster

Key Points: 

    Christine Lagarde: Unlocking the power of ideas

    Retrieved on: 
    Tuesday, April 23, 2024

    Since 2022 rising housing costs have, on average, largely been offset by growth in household income, leading to stable housing cost to household income ratios.

    Key Points: 
    • Since 2022 rising housing costs have, on average, largely been offset by growth in household income, leading to stable housing cost to household income ratios.
    • The housing cost burden has, however, increased slightly for both renter and mortgage households at the upper end of the income distribution.

    Trust in the ECB – insights from the Consumer Expectations Survey

    Retrieved on: 
    Tuesday, April 23, 2024

    This article shows that trust in the ECB needs to be analysed and understood as a multifaceted concept. Analysis of data from the Consumer Expectations Survey shows that trust is not a matter of “yes” or “no”

    Key Points: 


    This article shows that trust in the ECB needs to be analysed and understood as a multifaceted concept. Analysis of data from the Consumer Expectations Survey shows that trust is not a matter of “yes” or “no”

    I wholeheartedly recommend The President: a brilliant revival of a play of decay, terror and revulsion

    Retrieved on: 
    Friday, April 19, 2024

    These are three of the central themes of Thomas Bernhard’s rarely performed play The President.

    Key Points: 
    • These are three of the central themes of Thomas Bernhard’s rarely performed play The President.
    • The Austrian is one of the greatest writers of the 20th century, best known in the English-speaking world as a novelist.
    • By the same token – and this is something Felski neglects to mention – his writing can be extremely funny.

    A complex writer

    • Through childhood and adolescence he was unhappy and suffered from a host of life-threatening lung ailments.
    • Eventually, his tuberculous-damaged lungs put paid to his youthful musical aspirations of being an opera singer, so he turned to writing.
    • Throughout his career, Bernhard’s feelings about his homeland were complex and fraught.
    • He was repeatedly attacked for being a Nestbeschmutzer, which roughly translates as “one who fouls their own nest”.

    The political landscape of 1975


    The President was Bernhard’s response to the volatile political climate in Europe of the time. The president of Bernhard’s demanding play – a fascist dictator in all but name – has just survived an attempt on his life. Anarchists are responsible. There is a possibility the president’s son, who has disappeared, pulled the trigger.

    • It was no coincidence the original production opened at the Stuttgart State Theatre on May 21 1975: the same date and city where the key members of the Red Army Faction went on trial.
    • The Red Army Faction was also vocal and scathing about Germany’s unwillingness to properly confront its Nazi past.

    ‘Uncomfortable truths’


    The creative team behind this version of The President clearly know their history. In his directorial program notes, Creed acknowledges the violent actions of the Red Army Faction would have loomed large in the imagination of audiences in 1975.

    • Similarly, Weaving has spoken approvingly of Bernhard’s willingness to speak “a lot of uncomfortable truths to his own country”.
    • In equal measure, however, both Creed and Weaving believe Bernhard’s historically timestamped play can tell us something about the here and now.


    Alexander Howard does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.

    Central bank asset purchases and auction cycles revisited: new evidence from the euro area

    Retrieved on: 
    Friday, April 19, 2024

    Working Paper Series

    Key Points: 
      • Working Paper Series
        Federico Maria Ferrara

        Central bank asset purchases
        and auction cycles revisited:
        new evidence from the euro area

        No 2927

        Disclaimer: This paper should not be reported as representing the views of the European Central Bank
        (ECB).

      • Abstract
        This study provides new evidence on the relationship between unconventional monetary
        policy and auction cycles in the euro area.
      • The findings indicate that Eurosystem?s asset purchase flows mitigate
        yield cycles during auction periods and counteract the amplification impact of market volatility.
      • The dampening effect of central bank asset purchases on auction cycles is more sizeable and
        precisely estimated for purchases of securities with medium-term maturities and in jurisdictions
        with relatively lower credit ratings.
      • On the other hand, central banks may influence price dynamics in these markets, most notably
        through their asset purchase programmes.
      • If so, do central bank asset purchases
        affect bond yield movements around auction dates?
      • Auction cycles are present when secondary market yields rise in
        anticipation of a debt auction and fall thereafter, generating an inverted V-shaped pattern around auction
        dates.
      • ECB Working Paper Series No 2927

        3

        1

        Introduction

        The impact of central bank asset purchases on government bond markets is a focal point of economic and
        financial research.

      • If so,
        do central bank asset purchases shape yield sensitivity around auction dates?
      • The paper provides new evidence on the effects of Eurosystem?s asset purchases on secondary market
        yields around public debt auction dates.
      • The analysis builds on previous research based on aggregate data
        on central bank asset purchases and a shorter analysis period (van Spronsen and Beetsma 2022).
      • Using
        granular data on Eurosystem?s asset purchases offers an opportunity to shed light on the mechanisms linking
        unconventional monetary policy and auction cycles.
      • Given this legal constraint, the study
        hypothesises that the effect of asset purchases on 10-year auction cycles is mostly indirect, and goes via price
        spillovers generated by purchases of securities outside the 10-year maturity space.
      • Taken together, these results provide new evidence about auction cycles in Europe and contribute to a
        larger literature on the flow effects of central bank asset purchases on bond markets.
      • Section 4 offers descriptive evidence about auction cycles in the euro area.
      • Auction cycles are defined by the presence of an inverted V-shaped pattern in secondary market yields
        around primary auctions.
      • That is, government bond yields rise in the run-up to the date of the auction and
        fall back to their original level after the auction.
      • Their limited risk-bearing capacities and inventory management operations are
        seen as key mechanisms driving auction cycles (Beetsma et al.
      • ECB Working Paper Series No 2927

        7

        Second, central bank asset purchases can alleviate the cycle by (partly) absorbing the additional supply
        of substitutable instruments in the secondary market (van Spronsen and Beetsma 2022).

      • This expectation is
        supported by several analyses on the price effects of central bank bond purchases (D?Amico and King 2013;
        Arrata and Nguyen 2017; De Santis and Holm-Hadulla 2020).
      • Empirically, previous research has provided evidence of auction cycles taking place across different jurisdictions.
      • (2016) detect auction cycles for government debt in Italy, but not in Germany, during the European
        sovereign debt crisis.
      • Research on the impact of central bank asset purchases on yield cycles around auctions is still limited.
      • Their paper provides evidence
        that Eurosystem?s asset purchases reduce the presence of auction cycles for euro area government debt.
      • Nonetheless, several questions remain open about auction cycles and unconventional monetary policy
        in the euro area.
      • Therefore, they
        provide only a partial picture of auction cycles and central bank asset purchases in Europe.
      • The use of granular data on central bank asset purchases is especially important in light of the modalities
        of monetary policy implementation of the Eurosystem.
      • Altogether, these elements motivate further investigation of the relationship between central bank asset
        purchases and auction cycles in the euro area.
      • Taken together, these results confirm that Eurosystem?s asset purchases mitigate yield cycles during auction periods and counteract the amplification impact of market volatility.
      • The findings confirm that the flow
        effects of central bank purchases on yield movements around auction dates are driven by lower-rated countries.
      • Additional analyses provide evidence for an indirect effect of purchases on auction cycles and highlight
        the presence of substantial heterogeneity across jurisdictions and purchase programmes.
      • Flow Effects of Central Bank Asset Purchases on Sovereign Bond
        Prices: Evidence from a Natural Experiment.
      • Federico Maria Ferrara
        European Central Bank, Frankfurt am Main, Germany; email: [email protected]

        ? European Central Bank, 2024
        Postal address 60640 Frankfurt am Main, Germany
        Telephone
        +49 69 1344 0
        Website
        www.ecb.europa.eu
        All rights reserved.

    Press release - Breakfast foods: Parliament adopts new rules to improve consumer information

    Retrieved on: 
    Thursday, April 18, 2024

    Parliament on Wednesday approved the provisional political agreement with Council on updated rules on the composition, name, labelling and presentation of certain 'breakfast' foodstuffs, the so-called “breakfast directives”, with 603 votes in favour, 9 against and 10 abstentions.

    Key Points: 
    • Parliament on Wednesday approved the provisional political agreement with Council on updated rules on the composition, name, labelling and presentation of certain 'breakfast' foodstuffs, the so-called “breakfast directives”, with 603 votes in favour, 9 against and 10 abstentions.
    • There will also be clearer labelling on sugar content in fruit juices as well as for minimum fruit content in jams and marmalades.
    • You can read more about the new rules in the press release after the deal with EU countries.
    • These initiatives will ensure that consumers are better informed and that both beekeepers and consumers are better protected against adulterated honey."

    Orphan designation: Diacerein Treatment of epidermolysis bullosa, 20/02/2014 Positive

    Retrieved on: 
    Thursday, April 18, 2024

    Orphan designation: Diacerein Treatment of epidermolysis bullosa, 20/02/2014 Positive

    Key Points: 


    Orphan designation: Diacerein Treatment of epidermolysis bullosa, 20/02/2014 Positive

    Is home bias biased? New evidence from the investment fund sector

    Retrieved on: 
    Thursday, April 18, 2024
    Rule of law, Journal of Accounting Research, Capital control, Domestic, CEPII, Research Papers in Economics, M. B, Regression analysis, Journal of International Economics, Foreign, Economic growth, Methodology, Row, International, Intuition, Risk, Heritage, Economic development, Goethe University Frankfurt, Overweight, Journal of Monetary Economics, Accounting research, International business, Paper, Political economy, Journal of Financial Economics, Environment, Website, United, Category, World Bank, Probability, Medical classification, Sun, Appendix, Handbook, G11, Quarterly Journal of Economics, Frankfurt, Institution, Investment, International economics, Journal of Political Economy, Corporation, G15, Logic, Dow Jones, PDF, Classification, ECB, CEIC, Károlyi, Policy, Outline, Household, Social science, JEL, Real, Bias, FDI, Journal, Research, Journal of Economic Literature, Credit, The Journal of Finance, Literature, Nationalization, European Central Bank, AA, Culture, Growth, Monetary economics, Section 5, Kho, Rule, Rogoff, Developed country, AAA, Finance, SHS, Control, Variable, Section 4, Language, Section 3, Role, Economy, Financial economics, Section 2, Freedom, Central bank, Incidence, Law, The Heritage Foundation, American Economic Review, Obstfeld, SSRN, Foreign direct investment, G23, Corruption, Quarterly Journal, Financial statement analysis, GDP, IMF Economic Review, Schumacher, University, MVI, Demirci, Dependent and independent variables, Lane, Common, Magazine, Bank, Reproduction, Security (finance)

    Key Points: 

      A new measure of firm-level competition: an application to euro area banks

      Retrieved on: 
      Thursday, April 18, 2024

      Abstract

      Key Points: 
        • Abstract
          This paper extends Boone (2008) by introducing a competition measure at the individual
          firm level rather than for an entire market segment.
        • We apply this extended Boone indicator to individual bank-level competition
          in the loan market in the four largest euro area countries and Austria.
        • Our new measure of firm-level competition enriches and complements
          other competition measures and provides a promising starting point for future market
          power analyses.
        • The only measure among non-structural measures that is based on the
          concept of competition as a process of rivalry is the Boone (2008) indicator.
        • We introduce
          a new performance measure of competition by extending the Boone indicator to the
          individual firm level.
        • Introduction
          The ability to reliably measure competition is valuable to researchers, analysts, and
          policymakers, especially antitrust authorities, financial supervisors, and central banks.
        • One broad
          category of indicators often used to measure competition are structural competition
          measures, such as static concentration measures, and dynamic measures, e.g., entry and
          exit rates.
        • Out of these measures, the only measure based on the
          concept of competition as a process of rivalry is the Boone indicator.
        • This study introduces a new performance measure of competition by extending the
          Boone indicator to the individual firm level.
        • It thus measures the
          increase in profits in percent of one percentage point increase in efficiency, with marginal
          costs as measure of efficiency.
        • We extend the theoretical
          underpinning of the measurement of competition for the entire market of Boone (2008) by
          a new measure of individual firm-level competition.
        • A concern of the literature is the gap
          between the practical application and the theoretical framework of Boone (2008).
        • We introduce within the same theoretical
          framework a new measure of competition on firm level, the MRP.
        • Our new
          measure significantly augments the antitrust evaluative framework by shedding light on
          whether a merger results in a less competitive market.
        • Our novel indicator focuses on
          firms? incentives to enhance their relative efficiency, as manifested in the elasticity
          between relative profits and efficiency.
        • However, an inefficient firm that is foreclosed could be more
          competitive than the larger efficient firm that relies on its scale economies.
        • Our new metric of competition unveils
          banks? ability to influence their profitability in the short term by cutting costs relative to
          their peers.
        • The new MRP indicator provides the ability to assess the impact
          of individual banks? competitiveness on their interest rate-setting behaviour in loan
          markets.
        • Incorporating this information promises a more refined understanding of the impact and
          timing of monetary policy rates changes on the real economy.
        • Section 3 introduces within the Boone
          (2008) theoretical framework our new measure of individual firm-level competition,
          including the interpretation of the MRP.
        • Section 4 provides an application of our new
          ECB Working Paper Series No 2925

          6

          individual firm-level competition measure to the loan market.

        • The StructureConduct-Performance paradigm (SCP) provides a traditional framework in the field of
          industrial organization for analysing competition behaviour in markets.
        • Concentrated
          markets ease the possibilities to collude implicitly or explicitly and therefore concentrated
          markets result in higher prices and profits.
        • For example, a tougher competition
          setup may lead to a reallocation of market shares, potentially forcing some firms to exit
          the market.
        • This approach gives firms? strategic behaviour
          central stage and focuses on the strategic interaction on prices and quantities, known as
          conjectural variation.
        • Another measure from
          this strand of literature is the H-statistic developed by Panzar and Rosse (1987).
        • The only competition measure from this performance literature where competition is the
          outcome from a process of rivalry is the Boone indicator.
        • A continuous and monotonically increasing relationship exists between
          RPD and the level of competition if firms are ranked by decreasing efficiency.
        • (2013) compare the Boone indicator with the price-cost margin
          and conclude that the profit elasticity is a more reliable measure of competition.
        • The high
          elasticity of profits to efficiency unequivocally indicates that the high market shares and
          therefore high profits are due to high efficiency.
        • A firm that quickly passes changes to the input prices is seen as a price
          taker with little market power.
        • Indicators of competition tend to measure different phenomenon and may provide
          conflicting messages, as reported for European banking by Carbo et al.
        • Application 2: Test the ?quiet life? and related market structure hypotheses using the
          MRP as competition or market structure measure.
        • Data
          Our application to individual bank-level competition in the euro area loan market uses
          balance sheet and income statement data from the Moody?s Analytics BankFocus for the
          calendar years 2013-2020.
        • As such, most publications
          on competition in the euro area includes the largest four member states.
        • Due to these restrictions the database was reduced to an unbalanced panel of up to 1862
          banks (depending on the year) from five euro area countries.
        • Application 1: Measure bank competition using MRP
          Looking at the distribution of the MRP for individual banks (Fig.
        • A similar finding for the four largest euro area countries as a group is
          reported in Carbo et al.
        • Application 2: Test of market structure hypotheses using MRP
          Our new measure of individual-bank competition can be used to test market structure
          theories.
        • Euro area banks? market power,
          lending channel and stability: the effects of negative policy rates, European Central Bank
          Working Paper, 2790 (February).
        • A
          new approach to measuring competition in the loan markets of the euro area, Applied
          Economics, 43 (23), 3155?3167.
        • Impact of bank competition on the interest rate pass-through in the euro area, Applied
          Economics, 45 (11), 1359?1380.