I am proud to give a congressional testimony on unequal global vaccinations and global supply chain disruptions. As the title of the hearing goes: A global crisis needs a global solution, here is the link: hearing and written testimony:
This is insane. Turkish case should be studied in all econ textbooks: How can you sink your currency with colossal monetary policy mistakes, eroding policy credibility and driving your risk premia to the roof in an emerging market with good fundamentals!
Our paper that constructs quarterly data for capital flows by sector since 1996q1 is forthcoming
@JEEA_News
and data is posted
@BIS_org
. To understand the vulnerability of corporates, banks and sovereigns to capital flows, this data is essential:
Super happy to see this paper finally out in RESTUD showing the risk channel of US monetary policy spillovers to emerging markets with amazing micro data from Turkey (we started working on this paper during 2010 US-QE!):
A long run started in 2012! Our "data paper" providing a guide for constructing representative firm data from ORBIS is in
@AEAjournals
. To show the importance of using representative data, we draw out implications for SME financing/concentration trends:
I highly recommend this lecture on inflation by
@IvanWerning
and thanks so much for citing our work on inflation and supply chains! Proud to be in the endogenous cost push shock group since 2021 with our early paper on inflation!
Our paper is out, w/
@GitaGopinath
and Mitali Das on the effects of pre-emptive policies to deal with capital flows related risk shocks for emerging markets; our work is related to IMF's influential IPF framework that I had the pleasure to contribute to:
Emerging markets can reduce their external finance premia during risk-off shocks by employing preemptive policies before these shocks, from Mitali Das, Gita Gopinath, and
@skalemliozcan
For all who are thinking about pursuing an Econ PhD and want to learn more about international econ, global connections over trade and finance, please come work with us at our new Global Linkages Hub
@BrownUniversity
! Apply here:
1st summer school in international was so much learning and fun in beautiful Crete! Thanks to organizers
@JavierBianchi7
,Martin Uribe, Costas Arkolakis, Natalia Ramondo, our host U. of Crete for giving us the opportunity to teach amazing students in trade & international macro!
Emmanuel, my dear friend, we loved you, we miss you. You were so brilliant, so kind, so much to give, a spectacular economist, an incredible person, a true friend. The world is less bright without you.
Here is NBER video on our paper predicting, 9 months ago, the detrimental effect of supply chain disruptions on recovery with uneven global vaccinations. Rich gain from investing in vaccinating the poor: "no economy fully recovers, until everyone does":
Had a great time presenting our work w/
@pierredeleo
@GitaGopinath
and listening interesting papers on "Macro in EM" conference honoring Martin Uribe, organized by Vivian Yue and Pablo Ottonello!
Had a great time at this year's Jackson Hole! Great program, nature, excellent hosting and an amazing number of women economists! Thank you
@KansasCityFed
!
Coverage of our inflation paper by
@nytimes
. The role of supply shocks/bottlenecks/labor shortages in driving consumer demand led inflation much higher is important to understand in a world of more supply shocks and a possible de-globalization.
It is time for "New Foundations for International Macro Policy" & to update our textbooks. You can watch my lecture here:
@Susan_Athey
's kind introduction starts at minute 34 & my lecture at minute 40.
1/Here is a great interview from
@ecb
chief economist Phil Lane
@FT
w/
@martinwolf_
on the current inflation debate in US and Europe. Our academic research on inflation with its sectoral network focus backs this up:
There is nothing surprising in current Turkish situation: if such a credit boom is financed with foreign debt instead of structural reforms, this type of crisis and loss of value in currency is inevitable as I wrote 4 years ago:
Our new NBER
@nberpubs
paper on risk-taking and monetary policy transmission shows the importance of heterogeneity in macro-finance using detailed loan-firm-bank level data from the U.S.
Honored to present our work decomposing demand and supply drivers of Euro area and US inflation to central banking community and academics at
#ECBForum
, paper, slides and video of the presentation here:
Yurt genelinde üniversitelerin uzaktan eğitime geçmesi depremin zararlarını geleceğe yayar. Hiçbir alternatif, yarınlara attığımız temellerimiz olan gençlerimizi kaybetmekten daha maliyetli değil. Temelleri zayıf atılan hiçbir şey ayakta kalamaz.
Great macro annual!
My discussion, the 2nd paper by Camara, Christiano, Dalgic-the International Monetary Policy Transmission Mechanism-that shows both trade and financial channels work to contract EM output with FED hikes:
Excited that our paper w/
@pogourinchas
, Veronika Penciakova, Nick Sander is forthcoming
@JEEA_News
. A novel channel, tested with European firm data during COVID: firm exit during liquidity shocks depends on government support under financial frictions.
My interview from yesterday
@BloombergTV
#JacksonHole2023
: 1) Stay with restrictive monetary policy until 2%. 2) Soft landing was always possible as shown in our 21-22 global production network papers. 3) Sectoral labor supply shocks are inflationary.
1/3 of the US inflation, as of end of 2021 is from supply side factors, inflation would have been 6 percent w/o the 3 percent coming from supply shocks as we have argued at the
#ECBForum
Do emerging market central banks raise rates when the US Fed does? They do not. However, even though they cut rates, market rates tend to rise from tightening global financial conditions, impairing monetary policy effectiveness.
@pierredeleo
@skalemliozcan
Conference for the mind and the soul!
Papers at Women in Macro conference
@VeronicaGuerri7
@afogli001
@mazzimon77
range from macro-effects of exchange rates to homelessness!
Recent
@TheEconomist
coverage of our work with
@GitaGopinath
,
@pierredeleo
on emerging market monetary policies and why they can be ineffective in the face of importance of external factors/finance:
I am honored to be part of the celebrations for Mark Gertler's birthday and BBVA award for Gertler, Bernanke, Kiyotaki and Moore at this amazing conference with super interesting papers:
Our work that makes the economic case for global vaccinations with my colleagues
@SelvaDemiralp
,
@Cem_Cakmakli
, Sevcan Yeşiltaş, and Muhammed Ali Yıldırım is featured in FT today!
Announcing the first Summer School in International Economics.
Hosted by University of Crete (Rethymnon, Greece) June 14-16, 2023.
Lectures by
@LucaFornaro3
,
@skalemliozcan
, Mendoza, Costinot, Eaton & Rappoport.
PhD students, apply by January 30:
Looking forward to the NBER EFG meeting today! We are presenting our paper on U.S. monetary policy transmission during low interest rate period of 2012-2019 with heterogenous firms and banks!
Türkiye yabancı yatırıcımcıdan borç alan bir ülke, borçlanma faizi küresel risk prim i ile hareket eder (şekil), yabancı yatırımcı negatif real faiz den borç vermez, kaçar ve enflasyon ve kur daha kötüye gider: ,
Together w/
@BryanHardyEcon
,
@StefanAvdjiev
,
@luisser
, we spent years on establishing this data, published
@JEEA_News
. It is the only data that can show capital flows/currency related vulnerabilities before crises. It is super that everyone can use it real-time thanks to
@BIS_org
!
My new piece in Project Syndicate on the Neo-Fisherian experiment of Turkey and why this will not work in a small open economy that finances its growth with capital flows:
2/2 Our work calculated trillions in costs of not vaccinating the poor countries for the rich countries; a return on investment in COVAX of 166 times.
@IMFNews
shows even bigger returns with investing in increasing vaccine supply!
Listened great papers at the conference by the
@IMFNews
on Advances in Monetary Economics and honored to be speaking in the policy panel on inflation together with
@ojblanchard1
,
@pogourinchas
and Phil Lane.
Great article from
@SoumayaKeynes
. If you want to learn how to be a more useful economist, come and work with us at the Global Linkages Lab at
@BrownUniversity
and apply for the pre-doc position: last day to apply is tomorrow!
Looking forward to Pierre-Olivier's
@pogourinchas
presentation of our joint work today with Veronika Penciakova and Nick Sander, and other talks, at the Jackson Hole conference,
Why policy credibility is key for FX market? w/
@liliana_vvarela
, in . Policy uncertainty can explain key puzzles for international risky arbitrage, more common for EMs. This is why UK is now an EM, fiscal credibility is questionable as in
@Francesco_Bia
Great conference on Geoeconomics, thanks
@MSchularick
,
@Ch_Trebesch
,
@cepr_org
. It was a great honor for me to deliver the laudation for
@GitaGopinath
, recipient of Bernard Harms prize! Here is the video for the prize ceremony and paper presentations:
We have worked on an extension of this paper that explains how much of the aggregate demand effect is due to fiscal stimulus: I will be presenting at the ASSA, Deglobalization session, January 6-"Quantifying the inflationary impact of fiscal stimulus under supply constraints"
I had a great interview with
@colbyLsmith
of
@FT
! Thank you for this great article summarizing my views and others' on FED, interest rates and inflation!
Here is our new paper that decomposes "observed" inflation in US and Eurozone, during 2020-2021, into supply and demand side drivers based on influential network model of
@DBaqaee
and Emmanuel Farhi. We also calculate exported/imported inflation.
COVID-19 response policies aimed at stimulating aggregate demand would not have produced such high inflation without the negative sectoral supply shocks, from Julian di Giovanni,
@skalemliozcan
,
@asilvub
, and Muhammed A. Yildirim
New name for financial repression: monetary policy transmission. Macroprudential policy is used to cap risk premia evident in diverging lending rates and policy rates. Textbook case---why EMs w/o monetary policy credibility cannot also use macroprudential
Don’t miss the keynote delivered by my amazing co-author
@skalemliozcan
today on firms in the global economy at Barcelona GSE Summer Forum!
Webinar Registration- Zoom
Sevgili arkadaşım,
@SelvaDemiralp
dan Türkiye ekonomisi 101 dersi! Yanlış ekonomik politikalara rağmen nasıl büyüyoruz?
My good friend and co-author
@SelvaDemiralp
explains why there is still growth in Turkey in spite of bad economic policies.
So frustrating to see the same policy mistake again and again in a large emerging market such as Turkey. Our earlier PS piece predicts this crisis exactly the way it is unfolding based on lost monetary policy credibility:
Looking forward to my plenary at Midwest Macro tonight
@SMUEconDept
,
@SposiMichael
and also Esteban's
@HansbergRossi
tomorrow. Great papers on the program, including young women economists and grad students!
Results so far in the most important election of 2023 that will have global implications:
33 percent of ballots opened. Kılıçdaroğlu is in the lead with 47.71!
Welcome Sebnem Kalemli-Ozcan (
@skalemliozcan
), from the University of Maryland (
@UofMaryland
), as keynote speaker to SHoF’s annual conference. She will present insights from her research on international transmission of US monetary policy index. Register:
Check out our Symposium on US Private Firms, financing, regulation and impact on aggregate macro- economy, organized by the University of Chicago’s Booth School of Business bringing together academics, regulators and data providers, will be livestreamed:
This was a great conference
@IMFNews
with timely papers on EM capital flows. I am honored to take part in the policy panel discussing current inflation, effects of strong dollar on EM and what EM can do.
Thank you for everyone's prayers, messages and interests in
#TurkeySyriaEarthquake
. You can make donations to FusunSayek Foundation below setup in the Hatay-Iskenderun region, on the ground, to help victims directly with immediate care and future rehabilitation/education needs.
Quantifying drivers of 2021-2023 inflation in the US is
@AEAjournals
: demand-amplified supply chain issues are important. We are now working on quantification for other countries through the global production network linkages.
Thank you all for your messages and prayers
#TurkeyEarthquake
. This is a catastrophe beyond words. Many of you asked how can you help. Anything counts, you can donate the items listed here:
Thrilled about our virtual
@bcentralchile
Annual Conference next week on EM Credibility, Investors Risk Perceptions & Capital Flows. 10 new papers, 2 keynotes by
@carmenmreinhart
& M. Obstfeld. Joint with
@skalemliozcan
. Hard to find a more relevant topic for EMEs these days!
Had an amazing time at JacksonHole! Academics and policy makers' interactions were great! Excellent presentations by
@GitaGopinath
@Francesco_Bia
and others point to key sources of inflation: fiscal stimulus and supply side-cost push shocks. We quantify how much each accounts for
My dear friend Selva
@BloombergHT
Hayatta dogru yoldan yuruyup, adil olup, insanlari ezmeden ve haksizlik yapmadanda basarili olundugunu cocuklarina ogretmek isteyen anne-babalar icin mutlak seyir.
📢 Bir Hayat Hikayesi: Prof. Dr. Selva Demiralp
❓ Küresel ekonominin merkezi FED'e giren ilk Türk olmayı nasıl başardı?
📝 Aşı eşitliği çalışmalarıyla dünya basınına nasıl damga vurdu?
🤔 Bir kadın iktisatçı olarak iş hayatında neler yaşadı?
#Profil
▶️
I had a great interview with
@petercoy
@nytimes
on the global role of strong dollar and what does this imply for the FED and global policy coordination:
Next Wednesday March 1st and Thursday March 2nd the “International Fragmentation, Supply Chains, and Financial Frictions” conference will be held together with the
@nberpubs
.
Check the program out at .
Don’t miss it!
Our paper's summary
@voxeu
with
@GitaGopinath
@pierredeleo
on emerging market monetary policy cyclicality, US monetary policy and risk premia leading to a short-rate disconnect for emerging markets.
Absolutely brilliant AEA/AFA luncheon address from
@GitaGopinath
; honored to be there; must reading for academia and policy world and for all the students in international macro!
Just gave the AEA Joint luncheon address on “New Foundations for Macro Policy” Great to see old friends, including brilliant women
@Susan_Athey
, President of AEA, &
@skalemliozcan
.
Thrilled about our virtual
@bcentralchile
Annual Conference next week on EM Credibility, Investors Risk Perceptions & Capital Flows. 10 new papers, 2 keynotes by
@carmenmreinhart
& M. Obstfeld. Joint with
@skalemliozcan
. Hard to find a more relevant topic for EMEs these days!
Devastated that Philippe Martin has passed away. A great economist, and a wonderful mentor and colleague at the
@CAEinfo
. It was always such a pleasure working and talking with him. Rest in peace dear Philippe, you’ll be deeply missed.
Here is an excellent short video at NBER by
@pogourinchas
describing our joint work with Veronika Penciakova and Nick Sander on COVID-19, SME failures and Fiscal Policy:
Tomorrow starts in Paris the conference in the honour of Emmanuel Farhi
.
@cepr_org
@cdf_InnovLab
Important to reread the beautiful article written by Jean Tirole on Emmanuel’s work in the Annual Review of Economics.
Tremendously important work from
@DBaqaee
and my dear friend Emmanuel. If you want to understand COVID related global supply chain issues and all the implications, this is your first stop. Not a day goes by without thinking what a huge loss to the world, losing Emmanuel is.
I think about Emmanuel's absence every day. He was a force of nature. I'm thankful I managed the final mile on this paper without him (with help from colleagues). My life, let alone research, will never be the same without him.
Please attend
#econmetoo
@AEACSWEP
panel; need to understand what is working and not working: The best practices report that I worked with Bayer, Pande, Rouse, Smith, Serrato, and Wilcox provides practical advice, not sure they are all applied.
Selva, basarili olmak isteyen kadinlar icin bir rol model, mutlaka seyredilmesi gereken bir video, AEA de genc kadin akademisyenler icin director of mentoring gorevini yaparken arayip bulamadigimiz videolardan.
US inflation is driven by demand and supply shocks in 2/3, 1/3 proportion respectively, where fiscal stimulus accounts for more than half of the demand side, from Julian di Giovanni,
@skalemliozcan
,
@Asilvub
, and Muhammed A. Yildirim
Alvaro
@Asilvub
is a fantastic UMD student on the market; studying inflation in SOEs using global networks that can amplify/smooth inflation without nominal rigidities. Quantitative impact of shocks is different relative to standard SOE model+ closed economies with networks!
My
@BloombergTV
interview w/
@Kathleen_Hays
. FED will not cut rates in 2023 as services inflation is sticky. We are not in an econ-wide banking crisis. Small business borrow from big regulated banks. Credit demand matters more when labor market is tight.
Finally! Science, knowledge, education and good work is winning, Turkish democracy is alive and well, as always : “it is the economy”—one cannot govern the economy, should not govern!
Erdogan Set for Shock Defeat in Turkey’s Municipal Elections
Foreign shocks are important for Euro area inflation even before the war/energy/food crisis. Our model based decomposition shows 2/3 of the observed inflation in the EA is due to foreign shocks; inflation would have been 2 percent in the absence of foreign shocks that add 3%.