samchain/econo-pairs-v1 huggingface dataset:
A value larger than 0 of a sector means that the UK  them any less true. has a revealed comparative advantage in that sector. 15  Paul Krugman (1998), irritated especially by opposition to international trade among contemporary intellectuals, suggested it may partly reflect a preference for the modern and unorthodox over long-established ideas, even when they’re still true: “[Try] telling an ambitious, energetic, forward-looking intellectual…that before he can start talking knowledgeably about globalisation he must wrap his mind around a difficult concept that was devised by a frock-coated banker 180 years ago”. 16 The Governor recently commented on the potential impact of Brexit on the cost of financial services in the EU (Carney (2017)) 13  All speeches are available online at www.bankofengland.co.uk/speeches  13  References Acemoglu D., 1998, ‘Why Do New Technologies Complement Skills? Directed Technical Change and Wage Inequality’, Quarterly Journal of Economics, 113(4):1055-1089. Autor, D., Dorn D., and G. Hanson, 2013, ‘The China Syndrome: Local Labor Market Effects of Import Competition in the United States’, American Economic Review, 103:6, pp. 2121-68. Autor, D., Katz L. and M. Kearney, 2006, ‘The polarisation of the U.S. labour market’, NBER Working Paper no. 11986. Baldwin R., 2011, ‘Trade and industrialisation after globalisation's 2nd unbundling: How building and joining a supply chain are different and why it matters’, NBER Working Paper No. 17716. Behar A., 2013, ‘The Endogenous Skill Bias of Technical Change and Inequality in Developing Countries’, IMF Working Paper no 50.

That’s quite something given the general rate of inflation in the 1970s and 80s. In real terms – relative to the rest of the consumer basket – they fell by over 80%. This has brought significant benefits for consumers. It’s hard to say what would’ve happened in the absence of globalisation. But let’s suppose that, in that event, real clothes prices would have continued to fall at the 1%-or-so pace we saw prior to the mid-1970s (and since 2008). By comparison the actual decline in prices over the past 40 years has added just over 3% to real household incomes. At the same time the domestic production sector has clearly suffered (Chart 6). It didn’t start in a great position, it should be said. In 1975 it was a comparatively unproductive industry: per capita value added was 30% below the UK average. It required and employed relatively low-skilled labour: the average full-time wage was £ a year – barely £ per hour in today’s money and over a third lower than in the rest of the economy. Even then the country was buying more clothes than it produced: the balance of trade in clothing and textiles was already in deficit. Ricardo may have chosen British cloth as his quintessential example of a comparative advantage. But by the 1970s, if not long before, the position had been reversed. Faster productivity growth in the same sector in other countries, and in other sectors at home, had turned that into a comparative disadvantage.
Ravi Menon: Global regulatory reforms – what’s done, what to watch for Opening remarks by Mr Ravi Menon, Managing Director of the Monetary Authority of Singapore, at the 4th Pan-Asian Regulatory Summit, Singapore, 25 September 2013. *  *  *  Mr Leas Bachatene, VP & Managing Director (Asia Pacific), Thomson Reuters Distinguished guests, ladies and gentlemen, good morning. Exactly five years ago, this month, Lehman Brothers collapsed and unleashed a financial crisis of unmatched scale and impact. The crisis exposed deep fault lines in the global financial system and spurred far-reaching financial regulatory reforms, aimed at building a more resilient financial industry that better serves the needs of the real economy. This morning, I will take stock of the impact of these regulatory reforms: •  the progress we have made in making the global financial system safer; and  •  the possible unintended consequences that we must watch for. As a member of the Financial Stability Board, the Basel Committee on Banking Supervision, and various other international regulatory forums, the MAS has been a strong proponent and early implementer of many of these reforms. But we have not flinched from going above international standards where necessary or refraining from some measures in other jurisdictions which we regard as not relevant in our context. Progress in regulatory reforms Let me start with the progress in regulatory reforms. Increasing the capacity to absorb losses A centrepiece of the reforms in banking is the new Basel III capital standards. Basel III does three things.

Inflation targeting was therefore introduced in 2001. High and variable inflation usually accompanies instability in output and employment. But inflation should not be too low over time either. This is partly because the structure of the economy evolves over time. Demand for labour with different qualifications changes. Restructuring requires changes in real wages and relative wages. Nominal wages do not readily fall. With some measure of inflation, real wages and relative wages can be changed without reducing nominal wages. Some degree of inflation will oil the economic machinery. In periods, it will be appropriate to stimulate the economy with low, or even negative, real interest rates. If inflation becomes entrenched at a very low level, the interest rate will be less effective as an instrument because it cannot be set below zero. If the economy is again exposed to unexpected negative disturbances, we will have little scope for manoeuvre. Stability in output and employment In the long term, output and employment are determined by the supply of labour, capital and technology and by the ability to adapt. Monetary policy can contribute to smoothing fluctuations in output and employment. Norges Bank weighs stable inflation against stable output and employment. 2  BIS Review 53/2004  The output gap is a measure of the difference between the actual level of output and potential output. Potential output, which is the level of output that is consistent with inflation over time, is not directly observable and must be estimated.
By transferring risks to those most willing to bear them, they help households and businesses insure against the unexpected. But if left unattended, markets can be prone to excess and abuse. That is particularly so in financial markets, where means and ends too easily become conflated. Value becomes abstract and relative. And the pull of the crowd can overwhelm the integrity of the individual. Lie three is that “markets are moral” – that financial capital can take for granted the social capital necessary for markets to fulfil their promise. Consider the example of fixed income, currencies and commodities markets, which historically have relied heavily on informal codes and understandings. That informality was well suited to an earlier age. But as markets innovated and grew, it proved wanting. Markets need to retain the consent of society – a social licence – to be allowed to operate, innovate and grow. Repeated episodes of misconduct (such as the Libor and FX scandals) have called that social licence into question. To restore it, we need to rebuild fair and effective markets. 9  Knight, F (1921), Risk, uncertainty and profit, Signalman Publishing. 10  In Keynes (1936), Chapter 12, he wrote: “Even apart from the instability due to speculation, there is the instability due to the characteristic of human nature that a large proportion of our positive activities depend on spontaneous optimism rather than on a mathematical expectation, whether moral or hedonistic or economic.

BIS central bankers’ speeches  the past three decades is extraordinary, and it has helped to lift billions of people around the world out of poverty. However, the Chinese economy’s post-crisis performance has been bolstered by a large build-up of debt, which has more than doubled to reach almost 200% of GDP. As had been the case in the advanced world, the Chinese debt boom owed much to an explosion of shadow banking, which relates to the second lie of finance. Lie II: “Markets always clear” Beneath the new era thinking of the Great Moderation lay a deep-seated faith in the wisdom of markets. Policymakers were captured by the myth that finance can regulate and correct itself spontaneously. They retreated too much from the regulatory and supervisory roles necessary to ensure stability. 3 That “markets always clear” is the second lie, one which gave rise to the complex financial web that inflated the debt bubble. In markets for goods, capital, and labour, evidence of disequilibria abounds. In goods markets, there is ‘sluggishness everywhere’. Left to themselves, economies can go for sustained periods operating above or below potential, resulting, ultimately, in excessive or deficient inflation. Yet efficient market forces ‘should’ bring about changes in prices sufficient to equate demand with potential, leaving inflation as a purely monetary phenomenon. In labour markets, there is ‘rigidity everywhere’. Rather than fluidly adjusting to equate the demand for labour with its supply, periods of deficient labour demand can persist, sustaining mass unemployment and joblessness.
And one of the most important duties of a central bank is to safeguard the financial system. In a crisis, that means acting as lender of last resort, supplying emergency loans to financial institutions when normal funding isn’t available. The U.S. Treasury Department and other federal agencies were also doing all they could to shore up the financial system. Now, I know that this financial support to big banks and Wall Street firms made many people irate, especially when so many Americans were losing their jobs or their homes. We should remember, though, that ordinary people suffer terribly when the financial system breaks down. The ultimate goal of our programs was to avert a major depression and much higher unemployment. Because of these programs, we were able to avoid a meltdown of the financial system and head off a depression. But we couldn’t prevent a terrible recession. The shock waves from the burst housing bubble and the financial crisis were simply too great. As it happens, it’s normal that severe recessions and sluggish recoveries follow financial crises.1 Research at the San Francisco Fed and other places shows that downturns following financial crises are much more severe when the preceding expansions had unusually rapid growth of credit and leverage.2 When the credit pendulum swings, it takes many years for household and business spending to return to normal. And, in fact, there was extraordinary credit growth before the recession.

2  BIS central bankers’ speeches
Quite a good progress has been made in fulfilling all these commitments, and yet there is more to be done. The Ministry of Finance regularly publishes information on the progress in the performance and the outstanding tasks. The third group of tasks deals with the legislative programme that must ensure the legal framework for the operation of institutions and businesses within the euro area. Some progress has been made on these tasks too. Several legal acts have already been adopted. Some of the issues that are most complicated from a legal point of view, regarding the BNB for example, such as the judicial protection of the Governing Council members other than the Governor, have been resolved with the amendments to the Law on the BNB passed by the Parliament at the end of last year. However, what still remains to be done is a lot more. And by saying this, I do not mean so much the readiness in terms of drafted legal acts, but rather the procedure for discussing and adopting these acts by the National Assembly. This also applies to the most important laws – the Law on the Euro adoption, and the Law on the BNB. The draft Law on the Euro adoption is about to be finished. The draft Law on the BNB has been finalised, according to the set timeline. It will be approved by the BNB Governing Council at its next meeting that will take place on 13 April, i.e. in about a week from now.

These are clear ways in which the trade-offs between higher perceived risks, accessibility and affordability associated with the micro segment can be managed more optimally. Sustainable microfinance programs are often successful if synergies are realized. Between governments, policymakers, microfinance institutions and donor organisations, significant synergies can be unlocked by aligning incentives, reducing barriers and enhancing coordination. The agent banking framework implemented in Malaysia has been a successful model where industry is able to capture opportunities for cross-sector strategic partnerships that can transform the microfinance landscape. Collaborative strategies to deliver solutions on telco and e-commerce platforms are similarly redefining new business models. For donors, the adoption of performance-based rewards should be strongly encouraged to focus on microfinance institutions to effectively serve their mandate. The reward system should take into account outreach, financial performance and impact on wellbeing. Another important point is that, regulators and supervisors should ensure regulatory framework should be proportionate in balancing innovation, inclusion and stability. Conclusion All of us have an important role to play in confronting the stark reality that the socio-economic dividends of a global wealth and growth need to be cascaded to all. The vulnerable segment cannot afford to wait for trickle-down growth. As policymakers, we should be concerned with effective financial intermediation and sustainable growth. We are duty-bound to make sure that the fruits of economic prosperity are more equitably shared. As a community, we are morally obligated to provide opportunity and hope for the unserved to improve their livelihood.
I will begin by explaining the issue of systemic risk in a little more detail, taking the recent crisis as my example, and making it clear why regulatory interventions in the financial system are necessary. On the basis of these explanations, I will then present the key criteria, which, in my opinion, should be used as guidelines when designing regulatory measures. In other words, I will be sketching the core components of a kind of roadmap for containing systemic risk. However, since we can never rule out the emergence of a new crisis, we also require a well-placed safety net. This will help to secure an adequate supply of liquidity to banks and markets, even at times of increased stress. A final section will be dedicated to this area, with some remarks on the importance of the central banks’ function as lender of last resort. Systemic risk and the financial crisis Normally a number of different factors are simultaneously responsible for the accumulation of systemic risk over time leading to a crisis – as happened in the recent crisis. A number of well-known examples of possible risk factors and undesirable developments in the financial system include irrational market developments (e.g. bubbles during the upswing or fire sales during the downswing), inadequate or inappropriate regulation (e.g. weak points in Basel II), excessive confidence in markets and models (e.g. VaR), false incentive systems (such as implicit state guarantees for systemically important banks), and complex and intransparent products (e.g. complex securitised loans).

with perfectly controlled deficits and levels of public debt, which logically places limits on the growth of public debt markets. This contradiction is known by economists as the “Triffin dilemma”. It was first identified in relation to the U.S. balance of payments deficits and the value of the dollar, but it can also be applied to fiscal equilibrium. The economy needs a growing volume of risk-free assets, but the more they are issued, the more risky they become. We cannot totally side-step this dilemma, but we can avoid making it worse. It is clearly not good for major developed countries to find themselves in a situation where their solvency is put into question, or to allow markets to think that under certain circumstances, they may be unable to honour all their commitments. But this is what we have done in Europe, against the better judgement of the ECB, by introducing the principle of private sector involvement. The idea is attractive in theory. However, its consequences for financial stability are extremely negative. There has never been any doubt about whether the United Kingdom or the United States would honour their debts. Today they are enjoying very favourable interest rates compared with Spain and Italy even though the latters’ fiscal fundamentals are better. I know that some attribute this difference in borrowing conditions to the actions of the UK and U.S. central banks. I do not agree.
Did you communicate with us at an early stage? Did you set in motion a careful effort to fully understand the issue and its ramifications? Did you learn  4  BIS Review 76/2006  from a specific problem to make broader changes that would allow your organization to be more proactive, rather than reactive, going forward? While the onus is clearly on the firm to carry out these various steps, our awareness of what is taking place often makes the process work much more smoothly and effectively. In turn, the Federal Reserve should aim to become more transparent in our conveyance of supervisory expectations. •  Through the exam process, we provide feedback to specific institutions, including comments directed at areas where we would expect continuing compliance risk management improvements. Most of this communication is, of course, a highly confidential dialogue between the supervisor and each supervised institution. •  As I mentioned when firm-specific problems are severe enough, we may take a public enforcement action. Professionals in the compliance risk management arena will find it valuable to keep track of actions issued by the agencies. Although a public action is levied on a firm-specific basis, it could hold a larger implication for the rest of the industry about issues where supervisors may be particularly focusing their attention. It could also signal an area where other banks may find similar weaknesses. •  When a fundamental change is expected on a widespread basis, we don’t convey our expectations by using public actions against individual firms.

Gent Sejko: The economy and banks, present and future challenges Speech by Mr Gent Sejko, Governor of the Bank of Albania, at the round table on “The economy and banks, present and future challenges”, organised by the Bank of Albania and Government of Albania with the banking system, Tirana, 16 September 2015. *  *  *  Your Excellency Prime Minister, Honoured representatives of international institutions, Dear bank executives and representatives, This meeting seeks to once again draw the attention on non-performing loans, an issue that has been discussed extensively over the recent years. It aims at fostering the shared and concrete commitment to reduce the stock of non-performing loans, increase the financial intermediation by the banking sector and underpin Albania’s economic growth. Following, I would like to list some facts. The high level of non-performing loans has not affected the banking sector’s stability. Liquidity and capitalisation indicators remain adequate and the financial performance has been positive and improving. But, the still-high percentage of non-performing loans has contributed to a higher perception of risk by banks; in turn, they have adopted a more conservative approach to lending. Our survey data point to tightened lending standards; meanwhile, the lending volume, albeit positive, is still considered as low. The credit quality has improved during this year. The non-performing loans ratio, after peaking 25%, fell to around 21% in July 2015.
In 1978, Helmut Schmidt said that “the citizens of Europe just want solutions to concrete issues".2 Nonetheless, we need a political ambition if we are to act – call it a “vision", if you wish. We need this because we have to make progress – it’s now or never: thanks to the economic recovery, and thanks to President Macron’s initial proposals at the Sorbonne, and the European chapter of the German coalition agreement – it is obviously not my place to comment on the rest of the agreement – we are enjoying historically favourable conditions. If we don’t act in 2018 – first the French and Germans, and then all 19 member countries of the euro area – we will never make headway. 2. How to strengthen the euro area: three new ideas I will now turn to my three new ideas to strengthen the euro area. In order to make genuine progress in Europe, we must first start with the real needs for corporate investment, and the resources at our disposal. In terms of needs, the key to growth in the euro area today is, without doubt, innovation. Chancellor Merkel spoke about it in Davos three weeks ago, while companies in Bavaria are well placed to recognise its importance: over the past 50 years, Bavaria has radically transformed its economy by rising to the challenge of innovation.

François Villeroy de Galhau: New ideas for Europe Speech by Mr François Villeroy de Galhau, Governor of the Bank of France, Munich, 15 February 2018. * * * Mr. Prime Minister, Ministers, Dr. Theo Waigel, Ladies and Gentlemen, It is an honour for me to speak here this evening, following on from my compatriot from the Saarland, the Finance Minister, Peter Altmaier. I am 100% French, but with family roots in Germany that go back two centuries... and Dr. Altmaier even represents my town of Saarlouis in the Bundestag. However, all honour today goes to Munich and to Bavaria, and I would like to thank Dr. Theo Waigel for so kindly inviting me. Dr. Waigel, you played a key role in the construction of our European currency. I would like to repeat the words that you used before the Bundestag in April 1998 in anticipation of the transition to the third phase of our Economic and Monetary Union: “After two devastating and painful world wars, the European project is opening up opportunities to our children and grandchildren that our mothers and fathers, our ancestors, would never have dared dream of".1 Twenty years later, we can state that monetary union is a success: 74% of euro area citizens support the euro, and this figure is as high as 81% in Germany. The Economic Union on the other hand, has not yet fulfilled its potential. And that is a concern for two reasons.