Explore the vast range of titles available.

In a two-sided reputation system, it is in the interest of both buyers and sellers to be a good transaction partner. What sounds wonderful in theory is unfortunately not so easy to implement in reality. Reputation systems can have flaws due to factors such as reciprocity and retaliation, selective reviewing, and reputation inflation. These flaws cause the ratings collected on the platform to diverge from the actual experiences that marketplace participants are having. When reputation systems are not thoughtfully designed, it can be hard to distinguish between the “high quality” and “low quality” interactions. This makes it difficult to identify and remove bad actors and increases the chances of a “bad match”. Innovations in reputation system design, such as simultaneous reveal of information, review incentives, and greater reliance on private feedback, are making it easier to implement two-sided systems while avoiding the common pitfalls.

We examine conventional approaches to evaluating the economic impact of protectionist trade policies. We illustrate these conventional approaches by applying them to the tariffs introduced by the Trump administration during 2018. In the wake of this increase in trade protection, the United States experienced substantial increases in the prices of intermediates and final goods, dramatic changes to its supply-chain network, reductions in availability of imported varieties, and the complete pass-through of the tariffs into domestic prices of imported goods. Therefore, the full incidence of the tariffs has fallen on domestic consumers and importers so far, and our estimates imply a reduction in aggregate US real income of $1.4 billion per month by the end of 2018. We see similar patterns for foreign countries that have retaliated with their own tariffs against the United States, which suggests that the trade war has also reduced the real income of these other countries.

For exiting products, statistical agencies often impute inflation from surviving products. This understates growth if creatively-destroyed products improve more than surviving ones. If so, then the market share of surviving products should systematically shrink. Using entering and exiting establishments to proxy for creative destruction, we estimate missing growth in US Census data on non-farm businesses from 1983 to 2013. We find missing growth (i) equaled about one-half a percentage point per year; (ii) arose mostly from hotels and restaurants rather than manufacturing; and (iii) did not accelerate much after 2005, and therefore does not explain the sharp slowdown in growth since then.

Women remain underrepresented in cabinets, especially in high-prestige, “masculine” portfolios. Still, a growing number of states have appointed women to the finance ministry—a powerful position typically reserved for men. Drawing on the “glass cliff” phenomenon, we examine the relationship between financial crises and women’s ascension to, and survival in, this post. With an original dataset on appointments to finance ministries worldwide (1972–2017), we show that women are more likely to first come to power during a banking crisis. These results also hold for currency and inflation crises and even when accounting for the political and economic conditions that might otherwise explain this relationship. Subsequent examination of almost 3,000 finance ministers’ tenures shows that, once in office, crises shorten men’s (but not women’s) time in the post. Together, these results suggest that women can sometimes seize on crises as opportunities to access traditionally male-dominated positions.

The persistent undershooting of its self-defined target to achieve inflation “below but near two percent” prompted the European Central Bank (ECB) to launch a review of its monetary policy strategy and adopt a symmetric inflation target. In this article, I examine the politics of accountability underlying the ECB’s re-definition of its price stability objective through a comparison with the strategy review of the Federal Reserve, which went further than the ECB by setting an average inflation target that intentionally seeks to pursue periods of above-target inflation to compensate for periods of below-target inflation. Drawing on a reputational perspective on public accountability, I elaborate two arguments. First, the ECB decided to engage in a strategy review and revise its inflation target to restore its performative and technical reputation in the face of its persistent undershooting of its inflation target in the decade after the great financial and euro crisis. Second, the presence of a stronger “deflationary bloc” in the region constrained the ECB in adopting an average inflation target and its associated make-up strategy without tarnishing its socio-political reputation.

We develop and estimate a general equilibrium model to assess the effects and welfare implications of central bank transparency. Monetary policy can deviate from active inflation stabilization, and agents conduct Bayesian learning about the nature of these deviations. Under constrained discretion, only short deviations occur, agents’ uncertainty about the macroeconomy remains contained, and welfare is high. However, if a deviation persists, uncertainty eventually accelerates and welfare declines. Announcing that inflation stabilization will be temporarily abandoned raises uncertainty. However, these announcements lower policy uncertainty and curb inflationary beliefs at the end of the policy. For the United States, enhancing transparency raises welfare.

This paper develops a dynamic rational expectations model of the credit rating process, incorporating three critical elements of this industry: (1) the rating agencies' ability to misreport the issuer's credit quality, (2) their ability to issue unsolicited ratings, and (3) their reputational concerns. We analyze the incentives of credit rating agencies to issue unsolicited credit ratings and the effects of this practice on the agencies' rating strategies. We find that issuance of unfavorable unsolicited credit ratings enables rating agencies to extract higher fees from issuers by credibly threatening to punish those that refuse to acquire a rating. Also, issuing unfavorable unsolicited ratings increases the rating agencies' reputation by demonstrating to investors that they resist the temptation to issue inflated ratings. In equilibrium, unsolicited credit ratings are lower than solicited ratings, because all favorable ratings are solicited; however, they do not have a downward bias. We show that, under certain conditions, a credit rating system that incorporates unsolicited ratings leads to more stringent rating standards.

Short food supply chains (SFSCs) have proven their resilience during recent challenges, including the COVID-19 global pandemic. The recent rise in inflation in France has posed new challenges too. This study examines how short food supply chains in the South of France are responding to the challenges posed by inflation including rising production costs and a potentially shrinking consumer base. We propose integrating the resilience literature with the concept of embeddedness. Through this cross-fertilization, we conceptualize resilience as a dynamic process shaped by relationships and consisting of distinct stages: absorption, adaptation, and transformation. The study, based on 30 semi-structured interviews with horticultural farmers, reveals the existence of distinct phases in farmers’ responses to the situation. In the early stages, farmers collectively tackled the problem of rising costs by using shared resources and social networks. During the adaptation phase, pricing strategies were adjusted, facilitated by cooperative agreements between producers in different SFSCs. In the transformation phase, farmers shifted to direct sales to reduce their dependence on unreliable retail intermediaries. SFSCs not only adapted to economic shocks but also cultivated resilient strategies that strengthened community ties. Our research highlights the complex and multifaceted nature of relationships within SFSCs, which typically begin as primarily transactional and often evolve to include elements of friendship and mutual support. Such relationships facilitate flexible and collective responses to disruptions. In addition, the study identifies shortcomings in current resilience frameworks, particularly with regard to addressing systemic challenges and the role of public policy. Future research would benefit from exploring how institutional support and territorial embeddedness can further enhance the resilience of SFSCs in different socio-economic contexts.

The paper examines the factors of global inflation acceleration in 2021–2022. We consider primarily the developed economies, where rates of inflation over the last two years have exceeded multi-year highs and have significantly exceeded target levels. We find that the cause of accelerating inflation was an imbalance between aggregate demand, which started to increase rapidly in the second half of 2020 as economies began to adapt to the circumstances of the pandemic, and aggregate supply, which encountered persistent constraints associated with interruptions in global supply chains. Significant support for demand was provided by fiscal stimulus that was unprecedented in scale and was accompanied by policy interest rates reaching extremely low levels, and by active injections of liquidity by central banks. The willingness of governments to implement ultra-expansionary monetary and fiscal policies can to a considerable degree be attributed to the fact that during the previous decade large budget deficits, zero interest rates, and programs of quantitative easing had not resulted in macroeconomic destabilization. We examine the view of many central banks that the inflationary wave would not be long-lasting, which was a crucial reason for delaying the interest rates increase. We consider the conditions in which the leading economies might fall into the stagflation trap.

Suppose an intermediary provides a benefit to buyers when they purchase from sellers using the intermediary’s technology. We develop a model to show that the intermediary would want to restrict sellers from charging buyers more for transactions it intermediates. With this restriction an intermediary can profitably raise demand for its services by eliminating any extra price buyers face for purchasing through the intermediary. We show that this leads to inflated retail prices, excessive adoption of the intermediaries’ services, overinvestment in benefits to buyers, and a reduction in consumer surplus and sometimes welfare. Competition among intermediaries intensifies these problems by increasing the magnitude of their effects and broadening the circumstances in which they arise. We discuss applications to payment card systems, travel reservation systems, rebate services, and various other intermediaries.