samchain/econo-pairs-v1 huggingface dataset:
At time T1, when real wage W1 drops relative to the peak value W0, the cumulative real wage gap is the area A (equal to the real wage gap). At time T2, when real wage drops even further, the cumulative real wage gap is the sum of areas A and B. At time T3, the real wage starts to increase, but as it remains below the peak value, the cumulative real wage gap further deepens (A+B+C). At time T4, when the real wage increases above the peak reference value, the cumulative real wage gap starts to shrink (A+B+C+D). The growth of real wage makes the cumulative real wage gap to close at time T5 (A+B+C+D+E) and to enter into the positive territory at time T6 (A+B+C+D+E+F). The cumulative real wage gap for the above 6-period model is described in the chart. Therefore, equation (2) can be written as follows: 𝑁 𝑐𝑊𝑔𝑎𝑝 𝑇𝑁 = ∑𝑁 𝑛=1(𝑊𝑇𝑛 − 𝑊𝑇0 ) = ∑𝑛=1 𝐴𝑛 where 𝐴𝑛 is the real wage gap between 𝑇𝑛 and 𝑇𝑛−1 , expressed as area. If a new recession comes at T7 (not shown in the figures), the new peak value for the real wage is the one recorded at T6.

For example, Canada did not have a wage adjustment during the first historical period, but it experienced one during the second period. We refer to the latter as the second episode of wage adjustment in Canada. Peak years are country-specific; hence they are not the same in all countries. This means that the first wage adjustment episode, including the peak years, may have lasted, for example, 7 years in Italy, 8 years in Germany and France, 9 years in US, 20 years in Korea or 28 years (and counting) in Japan. Of the 35 countries analysed, 21 countries experienced the first historical episode of wage adjustments, 33 countries experienced the second historical episode of wage adjustments and only 2 countries experienced the third historical episode of wage adjustments. This is why the total number of observations is much higher for the second wage adjustment episode, compared against the first wage adjustment episode. In the case of the third wage adjustment episode, the total number of observations is much lower. And now we move to the juicy part. We present the graphical representation of our results for all OECD countries which experienced wage adjustments (21 countries for the first wage adjustment episode and 33 countries for the second wage adjustment episode). The results are statistically significant and with the expected sign for the first two adjustment episodes. For the third adjustment episode, the sign of the relationship is as predicted, but the number of observations is too limited to have statistical significance.
Today, it is precisely this element in Islamic finance amongst others, that are highly relevant to the discussions on the reform of the national and international financial system so that we have a system of financial intermediation that is stable, sustainable and contributes to global growth. In ten years now Islamic finance has experienced accelerated growth and the financial landscape has undergone a major transformation with great progress achieved on many fronts. The transformation is particularly evident in three dimensions, firstly, Islamic finance has evolved into a complete and competitive form of financial intermediation, effectively serving consumers and businesses, both Muslims and non-Muslims. Islamic finance has become a competitive form of intermediation with several established conventional players now entering the Islamic finance industry, resulting in more diverse Islamic financial institutions with wide spectrum of product range. Secondly, this recent decade has also seen significant milestones being achieved in the area of the international Islamic financial infrastructure of Islamic finance since the establishment of the Accounting and Auditing Organisation for Islamic Financial Institutions (AAOIFI) in 1990. In 2002, the Islamic Financial Services Board (IFSB) was established as an international prudential standard setting body for Islamic finance. The IFSB with a membership of now 50 regulatory authorities has since developed a number of standards ranging from capital adequacy requirements to standards for governance and risk management, taking into account the specificities of Islamic finance.

I know many of you have come here today to hear more about how to tap into this rapidly developing market to finance your business in the future. Now of course, as a global hub, it does not mean that all offshore RMB businesses are to be conducted only in Hong Kong. Quite the contrary. As RMB becomes more widely used and accepted by trading companies and investors worldwide, it is natural to see financial institutions providing RMB services to meet the demand of their customers. That said, even as its role evolves over time in line with market changes, we do see Hong Kong continuing to be an ideal place for companies to conduct their RMB banking and financing activities. In addition, Hong Kong will develop its ability as a RMB hub to serve a growing network of financial institutions around the world. And in this last respect we are seeing real signs of development. More foreign banks are either choosing to have a base in Hong Kong or are using RMB correspondent banking services provided by banks in Hong Kong. As of the end of March 2012, there were close to 200 banks participating in Hong Kong’s RMB clearing platform. Of these, 170 are foreign-owned or located overseas. At the same time, over 1,100 RMB correspondent accounts were maintained by overseas banks with banks in Hong Kong.
On the financial sector, beyond the European Union’s borders, and with all our partners, we have to strive to maintain the collective rules of the game that we have put in place since the G20 summit of London in 2009. Nine years later, some actors may be tempted to have short memories and forget the lessons of the crisis. But diluting financial regulation would pave the way for the next financial crisis. So we must now be firmly committed to the “full, timely and consistent implementation” of Basel III, as successfully agreed last December and stated in the last G20’s Buenos Aires communiqué. Neither the United States today, nor the United Kingdom tomorrow, should take the path of unilateral deregulation, and we welcome their commitment. Evaluation and simplifications are obviously possible, under the common FSB umbrella: but regulatory competition would be nothing less than a lose-lose scenario with disastrous consequences. However, we are not done with financial regulation yet. We still have to finalise ongoing initiatives, especially on shadow banking. Indeed, the regulatory priority is no longer the solvency of banks, but the liquidity of non-banks: we stressed these financial stability risks in our Washington meetings last week. Tomorrow, we at the Banque de France will publish the 2018 Financial Stability Review that is focused on fast-growing market-based finance. I stress that we have to better monitor it, test it – through liquidity stress-tests –, and regulate it when necessary.

And we face a number of important challenges in making sure our system is as strong as it can to be. But the substantial competition from a diverse set of financial institutions, including a strong presence by foreign financial institutions, is an integral part of what makes our financial system work well. Our system would not be as efficient or as innovative, and our financial institutions would not be as strong, if we were less open or less committed to giving all institutions similar national treatment and equality of opportunity. I thought I would give you a brief overview of the some of the key challenges we face as supervisors and those that confront the risk management community. The fundamentals of the present U.S. expansion seem relatively strong, with confidence in its sustainability increasing. As the balance of risks to the outlook have evolved, and the financial markets have built in expectations of a move to less accommodative financial conditions, this is a good time to assess how well the U.S. financial system is positioned to deal with this transition, and to withstand the effects of future stress, if that were to materialize. From our perspective, the U.S. financial system is in reasonably strong shape. Risk adjusted capital ratios are strong, and earnings have been robust. Non-performing loan ratios are very low - at about one percent on average across the banking industry. The financial markets are pricing risk in exposure to financial institutions at what are still relatively low levels.
The main questions in the LFS are about employment status: do you have a job and, if not, are you looking for one? (If your answer to the second question is “yes” you are counted as unemployed, if “no”, economically “inactive”.) As well as these headline numbers,  the UK and the terms of trade have been broadly constant in recent years. Thus the only source of real wage growth, over time, is productivity growth. 4  The inverse relationship between the NAIRU and productivity growth has been noted in many countries (Staiger et al (2001), Slacacek (2005)) nor is real wage resistance the only possible reason for the link. More micro-founded approaches to the labour market, based on the costs of job search, also predict a negative relationship between trend productivity growth and the natural rate of unemployment. In that setting, in which employers trade off the cost of search against the prospective surplus from a new job, lower expected growth in productivity reduces the present value of that surplus and lowers the rate of job creation. The canonical description of this “capitalisation” effect is due to Pissarides (2000). BIS central bankers’ speeches  3  the ONS’s monthly labour market release publishes standard summary statistics about the duration of unemployment and the reasons for inactivity. But, at least since 1994, the LFS has also included a host of questions about the characteristics of employees and their jobs. These are listed in Table 1.

Chart 7, summarising the results, is a version of a graph we published in the last two Inflation Reports. Note that, over time, the effects have tended to be positive. The average age and experience of the workforce has grown; more people have gone into higher education and higher-paid occupations. But on top of that underlying trend, we’ve seen sharp movements, in both directions, during the recent cycle. Both the drop in job creation during the Great Recession, and the corresponding pick-up during the recovery, were skewed towards the less skilled, less well paid end of the jobs market. Chart 8, which plots the differences in job creation across three classes of occupational characteristics, depicts one aspect of that pattern5. You can see similar differences in rates of job creation between young and old, less and more educated. And as I outlined in the introduction, the effect of these swings was to add materially to the growth of average earnings during the downturn and to subtract from it in 2013 and 2014. Unskilled employment generally more cyclical Before asking why this has happened let me make a few points about the estimates. First, there are some approximations involved. One involves the mix of surveys: we’re estimating the impact of compositional changes on LFS pay data and assuming the effect simply carries over to the AWE. That’s the most reasonable assumption, but it’s an assumption nonetheless.
BIS central bankers’ speeches  1  •  But Mark is one of the few who understand both worlds well, equally versed in the big, strategic issues related to macroeconomics and monetary policy and the nuts and bolts of financial markets and regulation. •  It is this combination that has enabled Mark to bring to our meetings a breadth of vision and depth of insight that make people sit up and listen. •  He has a knack for “herding the cats” as it were, bringing people together and finding consensus in the cacophony of views that international meetings are noted for. •  And Mark does this with a cheery disposition, a witty sense of humour, and considerable charm. Ladies and gentlemen, please join me in warmly welcoming Mark Carney. 2  BIS central bankers’ speeches

The most pressing challenge, therefore for the global economy, is to generate an economic recovery that is balanced and sustainable. Although the growth momentum has improved in a number of major economies, the growth has thus far been modest. In addition, weaknesses in several major economies continue to point to a global economy that remains vulnerable to downside risks. While the growth performance in most emerging economies is projected to moderate, collectively emerging market economies remain an important driver of growth of the world economy. A less robust external sector, BIS central bankers’ speeches  1  slower domestic demand and specific domestic factors are amongst the reasons for this growth performance. In Asia, the growth for 2015 is projected to be sustained at 6.4%, while growth in the ASEAN-5 is projected to be in the region of 5%. A further phenomenon affecting the global economic performance is the significant decline in global oil prices. While this has partially offset the weaker-than-expected growth momentum in some of the advanced countries, it has, in different degrees, adversely affected the oil exporting economies resulting in divergent growth performance across and within regions. Overall, however, the global economy is expected to benefit from the lower oil prices. A further recent development is the consequences of the unprecedented and divergent monetary policies being pursued in the major economies which have now resulted in significant policy spillovers to other parts of the world.
6  BIS central bankers’ speeches  Figure 3 Dollarization of liabilities of the corporate sector in Latin America: 1992-2009 (in percent, annual average across firms ) Argentina  Chile  Brazil  64  25  29  56  20  25  48  15  21  40  10  17  32  5 93 95 97 99 01 03 05 07 09  13 93  96  Colombia  99  02  05  08  93  Mexico 50  74  10  45  68  9  30  5  25 96  99  02  05  05  08  05  08  56  35  6  02  62  40  8 7  99  Peru  11  93  96  50 44 90  93  96  99  02  05  08  38 93  96  99  02  Exchange Rate Regime: Managed and Independently Fixed or Pegged Floating Source: IMF. BIS central bankers’ speeches  7

Philipp Hildebrand: Global economic prospects and key challenges for monetary policy Summary of a speech by Mr Philipp Hildebrand, Member of the Governing Board of the Swiss National Bank, at the Money Market Event, Zurich, 23 March 2006. The complete speech can be found in German on the Swiss National Bank’s website (www.snb.ch)  *  *  *  Summary Current economic developments are basically in line with the SNB’s expectations. Global economic activity is robust and the outlook is bright. The SNB expects broad-based growth of over 2% for 2006 and a moderate rate of inflation of approximately 1%. In addition to the usual economic risks, monetary policy today is faced with three key challenges. First, the effects of globalisation on inflation must be anticipated. Second, the way in which the interaction between globalisation and an ample supply of liquidity affects the price development of several assets needs to be analysed. The SNB's monetary policy concept enables it to take a long-term view and to recognise possible distortions early on. Third, identifying the neutral interest rate has become more difficult in today's environment. Many factors tend to support a lower neutral interest rate, while others would support a higher neutral rate. Against this background, the SNB will continue the gradual normalisation of its monetary policy. The scale and timing of this normalisation process will depend on further economic developments. Owing to a favourable inflation trend and well-anchored inflation expectations, we are in a position to cautiously approach a neutral interest rate level.
One positive indicator would be if firms identify and rectify individual misconduct cases quickly. Another would the absence of widespread conduct issues across firms. But we will want also to understand how the Code is affecting market functioning in a deeper sense. To this end, the GFXC plans to survey regularly market participants. This will enable us to track some of the less tangible indications of success, such how the Code is impacting and improving behaviours – transparency around pre-hedging for example – and how the Code is being embedded in the market through firms’ adherence expectations of their counterparties. An initial survey will be launched later this month, to give a benchmark against which subsequent survey results can be compared. I have no doubt of the commitment of many in the market to ensure success. What is needed now is to embed that attitude across the market as a whole and to ensure that our efforts so far translate into real improvements. Improved culture and attitudes regarding market conduct;  Improved confidence for end users that they are transacting at competitive prices;  And ultimately, a market that more effectively serves its economic purpose. So in closing I would ask again for your help in achieving that change. The success of the Code will depend above all else on the continued efforts of all involved in the market. Central bankers will remain deeply engaged, but to secure success we will be relying on the partnership with market participants that we have fostered.

Seeking broad adoption  So if we have reached the point where a new Code has been launched and there are encouraging early moves on adoption, what needs to follow? Most obviously, it’s important that we maintain this early momentum so that adoption becomes the norm. As I have already implied, virtually all of the firms directly engaged in developing the Code have publically stated their intention to sign up, and members of the various central-bank organised foreign exchange  4  http://www.globalfxc.org/public_registers.htm?m=62%7C379 3  All speeches are available online at www.bankofengland.co.uk/speeches  3  committees across the globe will do so too. This captures many of the large sell side firms and infrastructure providers. The challenge at this stage is to ensure that firms engaging in the full range of wholesale market activities are equally committed to incorporating the Code into their business practices. The audience in this room represents a key constituency: buy-side participants. A traditional, though I hope fading, attitude is to view codes of conduct as the preserve of sell-side firms only. But the Code provides key guidance that is relevant to both sides of any FX transaction. Moreover, an objective behind providing principled rather than rules-based guidance was to encourage market participants to think through how those principles apply to their own business context, and to apply the Code in a manner which is proportionate to that context.
The same debate may have led others to discover the exact size of the payments they can expect to receive as pensioners. As income levels rise, many will want to set aside more of their income for consumption later in life. In addition, today’s working population expects to live longer than previous generations, but also to be more active and in better shape than they were. Many people will therefore want to have more capital at their disposal as pensioners than public pension schemes can provide. Another reason to save is to have something put by to meet emergencies. In Norway, the tradition used to be to hide away some extra “daler” in savings in the bottom of a trunk. These emergencies are also to a greater extent now covered by public schemes such as unemployment benefit and disability pensions. At the same time, private schemes are becoming more common. Let us now look at how households save. Households save either in the form of fixed investment, mainly their own homes, or in the form of financial investments. This chart shows how households distribute their total wealth. The value of housing wealth is very uncertain. By our estimates, households’ total housing wealth was around NOK 2000 billion at the end of 2004. Housing wealth accounted for a little more than half of total gross household wealth at this time. The picture was about the same in the mid-1990s.

Households that save in banks or invest in other forms of financial assets make funds available to others. Banks convert some households’ savings into loans for other households wishing to finance house purchases, for instance. If we look at the household sector as a whole, savings accounted for about five per cent of household disposable income in 2004,1 which has been the level of saving for the past few years. These are funds that are channelled to the business sector in Norway or abroad to finance investment there. There may be various reasons behind a decision to save. In many cases, the objective is to spread consumption evenly through the course of a lifetime. Another reason may be the desire to leave behind an inheritance. For most people, the level of income will fluctuate through life. Most of our income is earned while we are economically active. Once our working career is over, we will have little to live on if we have not set aside capital as we earn or have secured our retirement by some other means. A hundred years ago, a common way of “saving” for old age was to have a large number of children. A large family increased the probability of some of the children growing up and being able to support their parents when they were old. By looking after family property, and perhaps expanding it, subsequent generations could also be provided for.