Papers by Christian Alexander Mongeau Ospina
The productivity slowdown in European countries is among the major stylised facts of the last two... more The productivity slowdown in European countries is among the major stylised facts of the last two decades. Several explanations have been proposed: some focus on demand-side effects, working through Kaldor's second law of economic growth (also known as Verdoorn's law), others on supply-side effects determined by a misallocation of the factors of production, caused either by labour market reforms or by perverse effects of financial integration (in Europe, related to the adoption of the euro). The latter explanation is put forward by some recent studies that stress how low interest rates brought about by the monetary union may have lowered productivity by inducing capital misallocation. The aim of this paper is to investigate the robustness of the latter empirical findings and to compare them with the alternative explanation offered by the post-Keynesian growth model, which instead emphasises the relation between foreign trade and productivity, along lines that go back to Adam Smith. To do so, we use a panel of industry-level data extracted from the EU KLEMS database, comparing these alternative explanations by panel cointegration techniques. The results shed some light on the role played by the single currency in the structural divergences among euro area member countries.
This paper assesses the impact on the Italian economy of Italy withdrawing from the euro area by ... more This paper assesses the impact on the Italian economy of Italy withdrawing from the euro area by means of stochastic simulations of a macroeconometric model. The model considers the effect of devaluation on output, sovereign debt valuation, and the development of bilateral economic relations between Italy and its major trade partners. The simulation results are consistent with the findings of recent applied research: the Italian economy would follow the V-shaped pattern observed in most currency crises. After an initial period of stress, and provided an appropriate set of countercyclical policy measures is implemented, real GDP would recover and resume growth at a reasonable pace. In particular, while the expected positive impact of nominal exchange rate realignment on external balance would be transitory, higher nominal growth would bring about a persistent reduction in unemployment and the public debt-to-GDP ratio. These results are robust to a set of sensitivity checks, considering a number of adverse circumstances such as exchange rate overshooting, financial panic, supply-side constraints, and the application of retaliatory tariffs.
This paper analyses the role of the composition of the regional stock of knowledge in explaining ... more This paper analyses the role of the composition of the regional stock of knowledge in explaining innovation performance. It provides three main contributions. First, it investigates the relevance of Jacobs knowledge externalities in characterizing the technological capabilities at the regional level. Second, it applies the Hidalgo–Hausmann (HH) methodology to analyze knowledge composition by looking at patent data of 214 regions, located in 27 state members of the European Union during the years 1994–2008. Third, it econometrically assesses the role of knowledge base composition in a knowledge-generation function. The results of the empirical analysis confirm that the characterization of the regional knowledge base through the HH indicators provides interesting information to understanding its composition and to qualify it as a provider of the Jacobs knowledge externalities that account for the dynamics of regional innovative performance.
Biofuel policies are motivated by a plethora of political concerns related to energy security, en... more Biofuel policies are motivated by a plethora of political concerns related to energy security, environmental damages, and support of the agricultural sector. In response to this, much scientific work has chiefly focussed on analysing the biofuel domain and on giving policy advice and recommendations. Although innovation has been acknowledged as one of the key factors in sustainable and cost-effective biofuel development, there is an urgent need to investigate technological trajectories in the biofuel sector by starting from consistent data and appropriate methodological tools. To do so, this work proposes a procedure to select patent data unequivocally related to the investigated sector, it uses co-occurrence of technological terms to compute patent similarity and highlights content and interdependencies of biofuels technological trajectories by revealing hidden topics from unstructured patent text fields. The analysis suggests that there is a breaking trend towards modern generation biofuels and that innovators seem to focus increasingly on the ability of alternative energy sources to adapt to the transport/industrial sector.
Applied Economics Quarterly, 2014
It is frequently claimed that the current EUR/USD exchange rate is too high and that a depreciati... more It is frequently claimed that the current EUR/USD exchange rate is too high and that a depreciation of the EUR against the USD would help to relieve the Eurozone economy from its current state of persistent crisis. Evidence provided by the a/simmetrie annual econometric model suggests that this claim is unsupported by the data, at least as far as the Italian economy is concerned. In fact, the size and sign of the trade elasticities show that the increases in net exports towards non-Eurozone countries, brought about by the depreciation of the euro, would be offset by an increase in net imports from Eurozone countries, brought about by the increase in Italian domestic demand. To put it simply, in the event of a depreciation of the EUR, the Italian economy would not only suffer higher energy costs (because of the depreciation vis-à-vis OPEC countries), but would also spend in the Eurozone core much of the money it earned in the US, Japan, and the emerging countries, with a net effect likely to be almost zero or negative in the first three to four years.
Building on the well-established "rockets and feathers" literature and on the recently developed ... more Building on the well-established "rockets and feathers" literature and on the recently developed nonlinear autoregressive distributed lag (NARDL) modelling, we investigate the asymmetries in gasoline pricing in a comprehensive sample of monthly data from twelve Eurozone countries from 1999:1 to 2015:12. The empirical results feature two robust patterns. Firstly, while the effects of exchange rate variations display positive asymmetry (i.e., depreciations have a greater effect than appreciations), crude price variations induce negative asymmetry (i.e., reductions in the price of crude oil have a greater effect than price rises). Secondly, the positive asymmetry to exchange rate changes is stronger in core Eurozone countries. The negative asymmetry with respect to crude oil prices confirms the results of recent empirical research and theoretical models. The different behavior between Eurozone core and periphery provides further insights into the nature of pricing asymmetries.
Using monthly data from 1994 to 2013 we study the long-run relation of the pre-tax retail prices ... more Using monthly data from 1994 to 2013 we study the long-run relation of the pre-tax retail prices of gasoline with crude price and the nominal exchange rate. We find a strongly significant long-run relation. We then use the nonlinear ARDL (NARDL) model to assess the asymmetries on both the short- and long-run elasticities, as well as the presence of hysteresis in the pricing behaviour. The estimation results confirm the presence of asymmetry in the long-run elasticities, with significant differences between the crude price and the exchange rate, as well as the presence of hysteresis in the relation between the retail price of gasoline and crude oil price.
Using monthly data from 1994 to 2012 we study the long-run relation between the pre-tax retail pr... more Using monthly data from 1994 to 2012 we study the long-run relation between the pre-tax retail prices of petrol and heating gasoil with crude price and the nominal exchange rate. We find a strongly significant long-run relation. We then use the nonlinear ARDL (NARDL) model to assess the asymmetries on both the short- and long-run elasticities. The estimation results confirm the presence of a strong asymmetry in the long-run elasticities.
We develop a medium-sized annual macroeconometric model of the Italian economy. The theoretical f... more We develop a medium-sized annual macroeconometric model of the Italian economy. The theoretical framework is the usual AS/AD model, where the demand side is specified along Keynesian lines, and the supply side adopts a standard neoclassical technology, with Harrod neutral technological progress. The empirical specification consists of 140 equations, of which 29 stochastic, with 55 exogenous variables. The model structure presents some distinct features, among which the disaggregation of the foreign trade block in seven trade partner regions (thus representing the bilateral imports and exports flows in function of the regional GDP and of the bilateral real exchange rates), and the explicit modelling of the impact of labour market reforms on the wage setting mechanism (which explains the shift in the Phillips curve observed over the last two decades). The model is conceived for the analysis of the medium- to long-run developments of the Italian economy, and as such it adopts econometric methods that allow the researcher to quantify the structural long-run parameters. The equation are estimated over a large sample of annual data (1960-2013), using cointegration techniques that take into account the possible presence of structural breaks in the model parameters. The model overall tracking performance is good. We perform some standard policy experiments in order to show the model’s response to usual shocks: an increase in public expenditure, an exchange rate devaluation, a slowdown in world demand, and an increase in oil prices. The shocks are evaluated by ex post simulation and their impact tracked over a five-year span. The dynamic multipliers appear to be consistent with the economic intuition.
It is frequently claimed that the current EUR/USD exchange rate is too high and that a depreciati... more It is frequently claimed that the current EUR/USD exchange rate is too high and that a depreciation of the EUR against the USD would contribute to relieve the Eurozone economy from the current state of persistent crisis. Evidence provided by the a/simmetrie annual econometric model suggests that this claim is unsupported by the data, at least as far as the Italian economy is concerned. In fact, the size and sign of the trade elasticities show that the increases in net exports towards non-Eurozone countries, brought about by the depreciation of the euro, would be offset by an increase in net imports towards Eurozone countries, brought about by the increase in Italian domestic demand. To put it simply, in case of a depreciation of the EUR, the Italian economy would not only suffer a higher costs of energy (because of the depreciation vis-à-vis OPEC countries), but also spend in Germany much of the money it earned in the US, Japan, and the emerging countries, with a net effect likely to be almost zero or negative in the first three to four years.
This paper presents a medium-size structuralmacroeconometric model of the Chinese economy, consis... more This paper presents a medium-size structuralmacroeconometric model of the Chinese economy, consisting of 54 equations estimated with annual data from 1978 to 2006. The estimation methodology accounts for structural breaks of unknown date in the long-run parameters, thus allowing us toinclude in the estimation sample a large span of data, encompassing the different stages of the reform process. The resulting equations have good statistical properties andparameters in line with their theoretical values. The structural breaks detected bythe econometric procedure are related to known major turning points in the transition process. The simulation experiments confirm the crucial role that FDI play in the economic growth and the competitiveness of China.
Books by Christian Alexander Mongeau Ospina
L'affermazione travolgente dell'economia cinese, a fronte dello sviluppo in deficit di quella sta... more L'affermazione travolgente dell'economia cinese, a fronte dello sviluppo in deficit di quella statunitense e della performance stentata di quella europea, sta diventando un tema molto frequentato del dibattito economico. Ai timori per il "sorpasso" da parte della Cina si contrappongono, nel mondo occidentale, le speranze per il contributo che la sua crescita può dare alla ripresa e all'ordinato sviluppo dell'economia mondiale.
Ma quali sono le cause, e quali le reali dimensioni di questo fenomeno? Quanti anni occorreranno perché la Cina sia in grado di affiancare stabilmente gli Stati Uniti nel ruolo di potenza trainante dell'economia mondiale? Qual è la possibile evoluzione nel medio termine degli squilibri esterni di Cina e Stati Uniti, e quali relazioni esistono fra di essi? Esistono credibili premesse per uno sviluppo in senso bi- o multipolare degli equilibri economici globali? Quali sono le prospettive dell'area euro in questo contesto? E in quale modo la recente crisi ha influenzato queste dinamiche?
Sono questi gli interrogativi che il saggio affronta, riprendendo, integrando e coordinando i risultati di una decennale attività di ricerca, assistita dall'impiego di un modello econometrico dell'economia mondiale. Sfruttando un database completo ed esteso di dati macroeconomici, il lavoro procede da un esame delle tendenze storiche recenti dell'economia cinese, per individuarne i punti di svolta più significativi e accertare, con diversi approcci metodologici, le cause della crescita cinese.
I dati vengono poi utilizzati per integrare il modello econometrico mondiale con la rappresentazione dell'economia cinese. Il modello esteso in tal modo permette di definire scenari di medio periodo riferiti all'impatto delle politiche macroeconomiche e delle tendenze demografiche cinesi sullo sviluppo dell'economia mondiale. L'analisi di questi scenari fornisce risposte quantitative ai quesiti sollevati, contribuendo in modo originale al dibattito sul ruolo dell'economia cinese.
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Papers by Christian Alexander Mongeau Ospina
Books by Christian Alexander Mongeau Ospina
Ma quali sono le cause, e quali le reali dimensioni di questo fenomeno? Quanti anni occorreranno perché la Cina sia in grado di affiancare stabilmente gli Stati Uniti nel ruolo di potenza trainante dell'economia mondiale? Qual è la possibile evoluzione nel medio termine degli squilibri esterni di Cina e Stati Uniti, e quali relazioni esistono fra di essi? Esistono credibili premesse per uno sviluppo in senso bi- o multipolare degli equilibri economici globali? Quali sono le prospettive dell'area euro in questo contesto? E in quale modo la recente crisi ha influenzato queste dinamiche?
Sono questi gli interrogativi che il saggio affronta, riprendendo, integrando e coordinando i risultati di una decennale attività di ricerca, assistita dall'impiego di un modello econometrico dell'economia mondiale. Sfruttando un database completo ed esteso di dati macroeconomici, il lavoro procede da un esame delle tendenze storiche recenti dell'economia cinese, per individuarne i punti di svolta più significativi e accertare, con diversi approcci metodologici, le cause della crescita cinese.
I dati vengono poi utilizzati per integrare il modello econometrico mondiale con la rappresentazione dell'economia cinese. Il modello esteso in tal modo permette di definire scenari di medio periodo riferiti all'impatto delle politiche macroeconomiche e delle tendenze demografiche cinesi sullo sviluppo dell'economia mondiale. L'analisi di questi scenari fornisce risposte quantitative ai quesiti sollevati, contribuendo in modo originale al dibattito sul ruolo dell'economia cinese.
Ma quali sono le cause, e quali le reali dimensioni di questo fenomeno? Quanti anni occorreranno perché la Cina sia in grado di affiancare stabilmente gli Stati Uniti nel ruolo di potenza trainante dell'economia mondiale? Qual è la possibile evoluzione nel medio termine degli squilibri esterni di Cina e Stati Uniti, e quali relazioni esistono fra di essi? Esistono credibili premesse per uno sviluppo in senso bi- o multipolare degli equilibri economici globali? Quali sono le prospettive dell'area euro in questo contesto? E in quale modo la recente crisi ha influenzato queste dinamiche?
Sono questi gli interrogativi che il saggio affronta, riprendendo, integrando e coordinando i risultati di una decennale attività di ricerca, assistita dall'impiego di un modello econometrico dell'economia mondiale. Sfruttando un database completo ed esteso di dati macroeconomici, il lavoro procede da un esame delle tendenze storiche recenti dell'economia cinese, per individuarne i punti di svolta più significativi e accertare, con diversi approcci metodologici, le cause della crescita cinese.
I dati vengono poi utilizzati per integrare il modello econometrico mondiale con la rappresentazione dell'economia cinese. Il modello esteso in tal modo permette di definire scenari di medio periodo riferiti all'impatto delle politiche macroeconomiche e delle tendenze demografiche cinesi sullo sviluppo dell'economia mondiale. L'analisi di questi scenari fornisce risposte quantitative ai quesiti sollevati, contribuendo in modo originale al dibattito sul ruolo dell'economia cinese.