Work in Progress
Not the Wage: The Incidence of the Output Gain in AI-Exposed Industries
Who ends up with the gain when a technology makes an industry more productive? It can go to buyers through a lower price, to workers through pay or hiring, or it can stay with the owners. I answer that question for the early part of the generative-AI era using national industry accounts for six economies, where real value added, its price and nominal value added come from the same account and decompose exactly. Industries are ranked by the exposure of their task content to artificial intelligence, and the measured output gain is split across the price, employment and pay margins, with horizon-matched placebos and wage statistics from outside the accounts used to check the margins the accounts leave open. Preliminary.
The value of exchange rate flexibility: Iceland, Sweden, and the euro
Does a floating exchange rate stabilise or destabilise a small open economy? We ask the question for Iceland and Sweden, two small inflation-targeting economies deeply integrated with the euro area, using the same structural VAR estimated separately for each country within a block-exogenous euro-area environment. The motivating fact is that flexibility has not bought Iceland stability: its exchange rate is far more volatile than Sweden’s over a matched sample, and so are its inflation and real activity. We trace domestic and ECB monetary policy shocks and exchange-rate risk-premium disturbances in each country, then price the regime choice with a welfare counterfactual robust to the Lucas critique, separating the mechanical channels of exchange-rate flexibility from the imported nominal anchor that euro adoption would deliver. Preliminary.
FDI, exchange rates and global shocks in commodity-exporting economies
Empirical analysis using mixed-frequency macro and financial data to quantify how foreign investment and global shocks affect exchange rates and financial conditions. Combines local projections and VAR-based methods.
Publications
Unveiling inflation: Oil shocks, supply chain pressures, and expectations
European Economic Review, Vol. 181, 2026
Abstract
After decades of low and stable inflation, advanced economies experienced a sharp and persistent surge in inflation following the COVID-19 pandemic. While many studies have examined the sources of this inflation, less attention has been paid to how domestic inflation expectations amplify global shocks. This paper makes a novel contribution by quantifying that amplification mechanism across six advanced, inflation-targeting economies: the United States, Canada, New Zealand, the Euro Area, the United Kingdom, and Norway. Using a structural Bayesian vector autoregression model, we jointly identify global demand and supply shocks, including various oil market shocks and global supply chain disruptions, as well as domestic shocks to inflation and inflation expectations. We show that these global shocks were key drivers of the post-pandemic inflation surge in all countries studied. Importantly, our counterfactual analysis reveals that inflation expectations have significantly amplified the transmission of global shocks, particularly in Canada, New Zealand, and the US. These findings demonstrate that the interaction between global forces and country-specific expectations is central to understanding inflation dynamics, and underscore the importance of managing inflation expectations as a tool to mitigate persistent inflation.
Working Papers & Policy Publications
The impact of monetary policy on leading variables for financial stability in Norway
CAMP Working Paper Series 02/2020
Abstract
We search for leading determinants of financial instability in Norway using a signaling approach, and examine how these respond to a monetary policy shock with the use of structural VAR models. We find that the wholesale funding ratio and gap, credit-to-GDP gap, house price-to-income ratio and gap, and credit growth provide good signals of future financial instability. Following a contractionary monetary policy shock, the credit-to-GDP gap and house price-to-income ratio decrease significantly. The implication of our findings is that the central bank can respond to an increase in these indicators by increasing the interest rate, which in turn will decrease the indicators and thereby the probability of financial distress.
A high-frequency financial conditions index for Norway
Norges Bank Staff Memo 1/2023
Abstract
Constructs a daily financial conditions index combining market prices and spreads to track short-run changes in Norwegian financial tightness and its co-movement with macro indicators.