Lars E.O. Svensson Affiliated Professor, Department of Economics, Stockholm School of Economics Twitter @leosven Menu Home Practical Monetary Policy Practical Monetary Policy Riksbank Monetary Policy Decisions Research Comments & Debate Topics Teaching Short bio CV Contact Links Interest rates during and after the crisis: Leaning against the wind, or not? “Interest rates during and after the crisis: Leaning against the wind, or not?”, keynote address at the workshop on “Interest rates after the financial crisis,” Örebro University and Kommuninvest, Örebro, October 3, 2017. Slides. Share This entry was posted in Lecture, New, Presentations on October 3, 2017 by admin. Transparency and communication with forecast targeting “Transparency and Communication with Forecast Targeting,” presentation (slides) at “Monetary Policy Framework Issues: Toward the 2021 Inflation-Target Renewal,” a workshop at Bank of Canada, September 14, 2017. Video. Share This entry was posted in Comments, discussions, New, Presentations on September 14, 2017 by admin. Englund och Svensson avstyrker Finansinspektionens förslag om skärpt amorteringskrav Finansinspektionens förslag till skärpt amorteringskrav för hushåll med höga skuldkvoter avstyrks i ett remissvar av Peter Englund och mig. Motiveringen för förslaget är att högt skuldsatta hushåll skulle kunna komma att minska sin konsumtion kraftigt om räntorna stiger eller vid ett inkomstbortfall och att detta i sin tur skulle kunna förstärka en konjunkturnedgång. Men, för det första, en konjunkturnedgång skulle normalt mötas med en räntesänkning av Riksbanken, inte en räntehöjning. Detta skulle förbättra högre skuldsatta hushålls kassaflöde mer än lägre skuldsatta. Höga skulder utgör på så vis en slags försäkring mot konjunkturnedgångar, och skulle normalt snarare dämpa än förstärka en konjunkturnedgång. I själva verket ökar höga skulder och rörliga räntor genomslaget för penningpolitiken och ger Riksbanken allt annat lika bättre möjligheter att stabilisera konjunkturen. För det andra, Finansinspektionens uppfattning att konsumtionen för högt skuldsatta hushåll skulle vara mer inkomstkänslig saknar empiriskt stöd. Den motsägs i själva verket av de vetenskapliga studier av internationella erfarenheter som Finansinspektionen anför till stöd för sin uppfattning. För det tredje, förslaget innebär ett steg tillbaka mot det tidiga 1980-talets detaljreglerade kreditmarknad, med åtföljande begränsningar av valmöjligheter och välfärd för drabbade hushåll. Läs hela remissvaret här. Ekonomista-inlägg med kommentarer och diskussion här. Share This entry was posted in Comments, discussions, Debate, New, Statements on September 8, 2017 by admin. Leaning Against the Wind: Costs and Benefits, Effects on Debt, Leaning in DSGE Models, and a Framework for Comparison of Results “Leaning Against the Wind: Costs and Benefits, Effects on Debt, Leaning in DSGE Models, and a Framework for Comparison of Results,” International Journal of Central Banking 13 (September 2017) 385-408. CEPR DP 12226, NBER WP 23745. Abstract: The simple and transparent framework for cost-benefit analysis of leaning against the wind (LAW) in Svensson (JME 2017) and its main result are summarized. The analysis of the policy-rate effects on debt in Bauer and Granziera (IJCB 2017) does not seem to contradict that the effects may be small and of either sign. The analysis of LAW in DSGE models is complicated and the results of Gerdrup et al. (IJCB 2017) may not be robust. The Svensson (JME 2017) framework may allow comparison and evaluation of old and new approaches and their results. As an example, it is shown that these three papers result in very different marginal costs of LAW and that a realistic policy-rate effect on unemployment is crucial. JEL Codes: E52, E58, G01 Share This entry was posted in Articles, Comments, discussions, New, Papers on August 21, 2017 by admin. Leaning Against the Wind: The Role of Different Assumptions About the Costs “Leaning Against the Wind: The Role of Different Assumptions About the Costs,” August 2017. Continue reading → Share This entry was posted in New, Papers on August 17, 2017 by admin. New publication: “Cost-Benefit Analysis of Leaning Against the Wind” Update, August 2017: “Cost-Benefit Analysis of Leaning Against the Wind,” published in Journal of Monetary Economics 90 (2017) 193-213. The first version, under the title “Cost-Benefit Analysis of Leaning Against the Wind: Are Costs Larger Also with Less Effective Macroprudential Policy?”, was published as IMF Working Paper WP/16/3, January 2016. Share This entry was posted in Articles, New, Papers, Update on July 27, 2017 by admin. Englund and Svensson reject Riksbank’s proposal for target variable and variation band Consultation response to the Riksbank’s memorandum “Change of target variable and introduction of variation band” Peter Englund and Lars E.O. Svensson, Stockholm School of Economics pdf Swedish Ekonomistas The Riksbank’s proposal for a change of target variable and the introduction of a variation band is rejected. There is no urgent need for these changes now, and it is inappropriate to forestall the parliamentary committee that currently reviews the monetary policy framework, including the issue of the choice of target variables and a possible variation band. The proposal for introduction of a variation band is specifically rejected. It does not serve any purpose and can, in practice, create a significant ambiguity about the inflation target, result in less effective anchoring of inflation expectations, and make it more difficult both to evaluate the Riksbank’s target achievement and to hold the Riksbank accountable for fulfilling the monetary policy goals. Continue reading → Share This entry was posted in Comments, discussions, Debate, New, Statements on June 20, 2017 by admin. Remissvar på Riksbankens PM om “Byte av målvariabel och introduktion av variationsband” Peter Englund och Lars E.O. Svensson, Handelshögskolan i Stockholm pdf English Ekonomistas Riksbankens förslag om byte av målvariabel och introduktion av ett variationsband avstyrks. Det finns inte något akut behov av dessa förändringar nu och det är olämpligt att föregripa den parlamentariska kommitté som gör en översyn av det penningpolitiska ramverket som bl.a. innefattar valet av målvariabel och eventuellt variationsband. Förslaget om introduktion av ett variationsband avstyrks speciellt. Det fyller inte någon funktion och kan i praktiken skapa en betydande oklarhet om penningpolitikens mål, ge ett sämre ankare för inflationsförväntningarna samt försvåra såväl en utvärdering av måluppfyllelsen som ett ansvarsutkrävande av Riksbanken. Continue reading → Share This entry was posted in Comments, discussions, Debate, New, Statements on June 20, 2017 by admin. New revision: “Cost-Benefit Analysis of Leaning Against the Wind” Update, August 2017: “Cost-Benefit Analysis of Leaning Against the Wind,” published in Journal of Monetary Economics 90 (2017) 193-213. The first version, under the title “Cost-Benefit Analysis of Leaning Against the Wind: Are Costs Larger Also with Less Effective Macroprudential Policy?”, was published as IMF Working Paper WP/16/3, January 2016. Share This entry was posted in Articles, New, Papers on May 21, 2017 by admin. Vox column: Re-evaluating the result that the costs of ‘leaning against the wind’ exceed the benefits Vox column: Re-evaluating the result that the costs of “leaning against the wind” exceed the benefits, January 24, 2017. The IMF and the Federal Open Market Committee have both suggested that the costs of ‘leaning against the wind’ exceed the benefits. This Vox column responds to claims that the results of my research backing up this conclusion could be overturned. It argues that the alternative assumptions necessary to overturn the result are unrealistic, and that the finding that the costs of the policy exceed the benefits therefore seems to be robust. The column summarizes “How Robust Is the Result That the Cost of “Leaning Against the Wind” Exceeds the Benefit? Response to Adrian and Liang.” Share This entry was posted in New, Vox column on January 24, 2017 by admin. How Robust Is the Result That the Cost of “Leaning Against the Wind” Exceeds the Benefit? Response to Adrian and Liang “How Robust Is the Result That the Cost of ‘Leaning Against the Wind’ Exceeds the Benefit? Response to Adrian and Liang,” working paper, January 2017. CEPR Discussion Paper DP11744. ECB Working Paper No. 2031/February 2017. Vox column Continue reading → Share This entry was posted in New, Papers on December 20, 2016 by admin. Commentary on Monetary Policy and Financial Stability “Commentary on Monetary Policy and Financial Stability” (slides), presented at “Challenges to Financial Stability in a Low Interest Rate World,” Annual International Journal of Central Banking Research Conference, Federal Reserve Bank of San Francisco, November 21-22, 2016 Share This entry was posted in Comments, discussions, Presentations on November 22, 2016 by admin. Discussion text of Kocherlakota, “Rules versus discretion: A reconsideration” The text is now available of my Comment on “Rules versus Discretion: A Reconsideration,” by Narayana Kocherlakota, Brookings Papers on Economic Activity, Fall 2016, 41-48. Share This entry was posted in Comments, discussions, New on October 31, 2016 by admin. Panel presentation: Should monetary policy take financial-stability considerations into account at the ELB? “Should Monetary Policy Take Financial-Stability Considerations into Account at the ELB?”, panel presentation (slides) at the First ECB Annual Research Conference, “Monetary Policy and Financial Stability in a Low Interest Rate Environment,” Frankfurt, September 28-29, 2016. Share This entry was posted in Presentations on September 29, 2016 by admin. Discussion of Gelain, Lansing, and Natvik: “Leaning against the credit cycle” Discussion (slides) of Gelain, Lansing, and Natvik: “Leaning against the credit cycle,” Swiss National Bank Research Conference “New Perspectives on the role, instruments and effects of monetary policy,” Zurich, September 23-24, 2016. Share This entry was posted in Comments, discussions, New on September 23, 2016 by admin. Post navigation ← Older posts High Quality | More Pictures Google Search WordPress Search Search for: Categories Categories Select Category Articles Blog post Comments, discussions Debate EconoMonitor Ekonomistas Interviews Lecture Lecture notes Media New Papers Presentations Speeches Statements TV Uncategorized Update Vox column Recent Posts Interest rates during and after the crisis: Leaning against the wind, or not? Transparency and communication with forecast targeting Englund och Svensson avstyrker Finansinspektionens förslag om skärpt amorteringskrav Leaning Against the Wind: Costs and Benefits, Effects on Debt, Leaning in DSGE Models, and a Framework for Comparison of Results Leaning Against the Wind: The Role of Different Assumptions About the Costs New publication: “Cost-Benefit Analysis of Leaning Against the Wind” Englund and Svensson reject Riksbank’s proposal for target variable and variation band Remissvar på Riksbankens PM om “Byte av målvariabel och introduktion av variationsband” New revision: “Cost-Benefit Analysis of Leaning Against the Wind” Vox column: Re-evaluating the result that the costs of ‘leaning against the wind’ exceed the benefits How Robust Is the Result That the Cost of “Leaning Against the Wind” Exceeds the Benefit? Response to Adrian and Liang Commentary on Monetary Policy and Financial Stability Discussion text of Kocherlakota, “Rules versus discretion: A reconsideration” Panel presentation: Should monetary policy take financial-stability considerations into account at the ELB? Discussion of Gelain, Lansing, and Natvik: “Leaning against the credit cycle” Archives 2017 October 2017 September 2017 August 2017 July 2017 June 2017 May 2017 January 2017 2016 December 2016 November 2016 October 2016 September 2016 August 2016 June 2016 May 2016 April 2016 February 2016 January 2016 2015 November 2015 October 2015 September 2015 June 2015 May 2015 April 2015 March 2015 February 2015 January 2015 2014 December 2014 November 2014 October 2014 September 2014 August 2014 July 2014 June 2014 May 2014 April 2014 March 2014 February 2014 January 2014 2013 December 2013 November 2013 October 2013 September 2013 August 2013 July 2013 June 2013 May 2013 April 2013 March 2013 January 2013 2012 December 2012 November 2012 October 2012 September 2012 August 2012 July 2012 June 2012 May 2012 April 2012 January 2012 2011 November 2011 September 2011 April 2011 March 2011 February 2011 2010 December 2010 November 2010 October 2010 September 2010 June 2010 May 2010 March 2010 February 2010 January 2010 2009 November 2009 September 2009 July 2009 June 2009 May 2009 March 2009 February 2009 January 2009 2008 November 2008 October 2008 September 2008 July 2008 June 2008 May 2008 March 2008 February 2008 January 2008 2007 November 2007 September 2007 August 2007 June 2007 May 2007 January 2007 2006 November 2006 March 2006 January 2006 2005 September 2005 June 2005 May 2005 January 2005 2004 December 2004 November 2004 September 2004 July 2004 May 2004 April 2004 March 2004 February 2004 January 2004 2003 November 2003 October 2003 September 2003 August 2003 June 2003 May 2003 April 2003 March 2003 February 2003 January 2003 2002 December 2002 November 2002 October 2002 September 2002 August 2002 July 2002 June 2002 May 2002 April 2002 March 2002 February 2002 January 2002 2001 December 2001 November 2001 1993 November 1993 Proudly powered by WordPress