Question 2: What will be the implications of recent developments in AI on unemployment in high income countries over the upcoming decade?
Answer:
Decrease
Confidence level:
Not confident
Comment:
Generally, I would expect increasing scarcity of labour due to demographic effects leading to a reduction in unemployment. This will very likely be the dominating factor. Ceteris paribus I think AI may well decrease unemployment a bit more, even while decreasing hours.
Question 2: Should the ECB respond to movements in the euro-dollar exchange rate of the nature observed in 2022?
Answer:
No
Confidence level:
Very confident
Comment:
The ECB should respond to inflation and the inflation outlook. Of course, inflation dynamics will be influenced by changes in exchange rates. For example, a lasting depreciation is putting upward pressure on inflation. Thus, indirectly exchange rate changes will feed back into policy.
Question 1: What was the main cause for the euro’s decline relative to the US dollar in 2022?
Answer:
Monetary policy differences
Confidence level:
Confident
Comment:
I would argue the main reason is the differential in interest rates. The ECB waited much longer than the Fed in raising rates. This is of course driven also by the perceptions regarding economic differences such as the stronger impact of the war and energy crisis on Europe.
Question 2: By how much would an immediate EU-wide import ban on Russian gas reduce German GDP growth per annum in 2022-3, in percentage points (pp), if the government offset the costs with a well-targeted fiscal policy?
Answer:
Between 5pp and 10pp
Confidence level:
Confident
Comment:
Again I think a reduction of 3 to 6% will not be avoidable. Demand side policies cannot fix this. It's not a liquidity problem that needs to be maanged with loans from the ECB or the government. A major long-term re-organisation of industrial production is necessary and some companies will drop out and gas dependent sectors decline. This takes time. The main policy need is to use all alternative ways for energy supply (nuclear, fracking, lignite coal, LNG imports). If that is really done quickly Germany might get through an embargo or cessation of deliveries by Russia with a smaller recessionary effect. Large increases in debt monetized by the ECB would simply further raise inflation on top of the cost-push shock. This is quite different from the corona shock, which was disinflationary.
The CFM surveys informs the public about the views held by prominent economists based in Europe on important macroeconomic and public policy questions. Some surveys focus specifically on the UK economy (as the CFM is a UK research centre), but surveys can in principle focus on any macroeconomic question for any region. The surveys shed light on the extent to which there is agreement or disagreement among these experts. An important motivation for the survey is to give a more comprehensive overview of the beliefs held by economists and in particular to include the views of those economists whose opinions are not frequently heard in public debates.
Questions mainly focus on macroeconomic and public policy topics. Although there are some questions that focus specifically on the UK economy, the setup of the survey is much broader and considers questions related to other countries/regions and also considers questions not tied to a specific economy.
The surveys are done in collaboration with the Centre for Economic Policy Research (CEPR).
Artificial Intelligence and the Economy
Question 2: What will be the implications of recent developments in AI on unemployment in high income countries over the upcoming decade?
Prospects for Euro Area Inflation in 2023
Question 3: Under its current policy trajectory, with rates peaking at 3.5%, which of the following is most likely?
Euro weakness in 2022
Question 2: Should the ECB respond to movements in the euro-dollar exchange rate of the nature observed in 2022?
Question 1: What was the main cause for the euro’s decline relative to the US dollar in 2022?
Effects of an embargo on Russian gas
Question 2: By how much would an immediate EU-wide import ban on Russian gas reduce German GDP growth per annum in 2022-3, in percentage points (pp), if the government offset the costs with a well-targeted fiscal policy?
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