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e61 Seminar Series | Some Like it Hot: Inclusive Monetary Policy Under Okun’s Hypothesis

31 January @ 12:00 pm - 1:00 pm AEDT

Virtual Event Virtual Event
Free

Presenter: Gianluca Violante

Authors: Gianluca Violante Princeton University and Felipe Alves, Bank of Canada

Time & Location

31 Jan, 12:00 pm – 1:00 pm
Macquarie Uni City Campus, Level 24/123 Pitt St, Sydney NSW 2000, Australia | Online

About the event

Okun (1973) argued that a ‘high-pressure economy’, albeit more inflationary, would persistently improve labor market outcomes of the most disadvantaged groups. To assess Okun’s hypothesis, we develop a heterogeneous-agent incomplete-market framework with a three-state frictional model of the labor market where employment and earnings trajectories of low-skilled workers are more exposed to the business cycle, in line with U.S. data. Relative to a standard inflation targeting rule, a monetary policy rule that is more accommodating during booms and more aggressive during recessions has long-lasting effects at the bottom of the distribution: for workers at the lowest quartile, participation increases by 2 ppts and real earnings by 5%.  The flip side of this more ‘inclusive’  monetary policy is 1.5 ppts of additional inflation.

Details

Date:
31 January
Time:
12:00 pm - 1:00 pm AEDT
Cost:
Free

Venue

Macquarie Uni City Campus
Level 24/123 Pitt St
Sydney, NSW 2000 Australia
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e61 Seminar Series | Some Like it Hot: Inclusive Monetary Policy Under Okun’s Hypothesis


Macquarie Uni City Campus Level 24/123 Pitt St, Sydney, NSW, 2000, Australia
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  • This event has passed.

e61 Seminar Series | Some Like it Hot: Inclusive Monetary Policy Under Okun’s Hypothesis

31 January @ 12:00 pm - 1:00 pm AEDT

Virtual Event Virtual Event
Free

Presenter: Gianluca Violante

Authors: Gianluca Violante Princeton University and Felipe Alves, Bank of Canada

Time & Location

31 Jan, 12:00 pm – 1:00 pm
Macquarie Uni City Campus, Level 24/123 Pitt St, Sydney NSW 2000, Australia | Online

About the event

Okun (1973) argued that a ‘high-pressure economy’, albeit more inflationary, would persistently improve labor market outcomes of the most disadvantaged groups. To assess Okun’s hypothesis, we develop a heterogeneous-agent incomplete-market framework with a three-state frictional model of the labor market where employment and earnings trajectories of low-skilled workers are more exposed to the business cycle, in line with U.S. data. Relative to a standard inflation targeting rule, a monetary policy rule that is more accommodating during booms and more aggressive during recessions has long-lasting effects at the bottom of the distribution: for workers at the lowest quartile, participation increases by 2 ppts and real earnings by 5%.  The flip side of this more ‘inclusive’  monetary policy is 1.5 ppts of additional inflation.

Details

Date:
31 January
Time:
12:00 pm - 1:00 pm AEDT
Cost:
Free

Venue

Macquarie Uni City Campus
Level 24/123 Pitt St
Sydney, NSW 2000 Australia
+ Google Map

Presenter: Gianluca Violante

Authors: Gianluca Violante Princeton University and Felipe Alves, Bank of Canada

Time & Location

31 Jan, 12:00 pm – 1:00 pm
Macquarie Uni City Campus, Level 24/123 Pitt St, Sydney NSW 2000, Australia | Online

About the event

Okun (1973) argued that a ‘high-pressure economy’, albeit more inflationary, would persistently improve labor market outcomes of the most disadvantaged groups. To assess Okun’s hypothesis, we develop a heterogeneous-agent incomplete-market framework with a three-state frictional model of the labor market where employment and earnings trajectories of low-skilled workers are more exposed to the business cycle, in line with U.S. data. Relative to a standard inflation targeting rule, a monetary policy rule that is more accommodating during booms and more aggressive during recessions has long-lasting effects at the bottom of the distribution: for workers at the lowest quartile, participation increases by 2 ppts and real earnings by 5%.  The flip side of this more ‘inclusive’  monetary policy is 1.5 ppts of additional inflation.

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e61 Lounge Session | The curious post-pandemic labor market in the US

3 February @ 12:00 pm - 1:00 pm AEDT

Free

with: Gianluca Violante

Time & Location

3 Feb, 12:00 pm – 1:00 pm
e61 Institute, Level 3/17-21 Bellevue Street Surry Hills NSW 2010, Australia

There are limited spaces available.

About the event

The post-pandemic labor market dynamics in the US are very unusual. Job vacancies have grown at an unprecedented pace, and job-to-job quits are at an historical peak (what the media have labelled `the great resignation’ or `the great reshuffle’). In this presentation, we look at some of these facts, including cross-industry evidence, and outline possible explanations. Different explanations have different implications for the possibility that the Fed can engineer a `soft-landing’ in the labor market after its several rate hikes.

Details

Date:
3 February
Time:
12:00 pm - 1:00 pm AEDT
Cost:
Free

Venue

e61 Institute
Level 3/17-21 Bellevue Street
Surry Hills, NSW 2010 Australia
+ Google Map
View Venue Website

RSVP

5 Going
RSVP Here
Loading Events

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  • This event has passed.

e61 Lounge Session | The curious post-pandemic labor market in the US

3 February @ 12:00 pm - 1:00 pm AEDT

Free

with: Gianluca Violante

Time & Location

3 Feb, 12:00 pm – 1:00 pm
e61 Institute, Level 3/17-21 Bellevue Street Surry Hills NSW 2010, Australia

There are limited spaces available.

About the event

The post-pandemic labor market dynamics in the US are very unusual. Job vacancies have grown at an unprecedented pace, and job-to-job quits are at an historical peak (what the media have labelled `the great resignation’ or `the great reshuffle’). In this presentation, we look at some of these facts, including cross-industry evidence, and outline possible explanations. Different explanations have different implications for the possibility that the Fed can engineer a `soft-landing’ in the labor market after its several rate hikes.

Details

Date:
3 February
Time:
12:00 pm - 1:00 pm AEDT
Cost:
Free

Venue

e61 Institute
Level 3/17-21 Bellevue Street
Surry Hills, NSW 2010 Australia
+ Google Map
View Venue Website

RSVP

5 Going
RSVP Here