We evaluate the effects of vaccines in the evolution of the epidemic in Spain during 2021. To this end, we estimate the effect of vaccination in terms of reducing infections, hospitalizations, ICU admissions, and deaths. We also compare the health impact of COVID-19 with that caused by recent influenza seasons, in a scenario where all the population had been vaccinated. The positive impact of vaccination on health indicators has been extraordinary. The non-availability of vaccines would have increased COVID-19 deaths by 571% compared to observed deaths. Moreover, the relative benefit of vaccination increases with the severity of the indicator: greater for deaths and ICU admissions, less for infections and hospitalizations. Under the assumption that the entire population had been vaccinated with the COVID-19 vaccine from the first week of April, the impact of the disease in terms of hospitalizations and deaths during 2021 would have been above a low activity flu season, but in line with a moderate/high activity flu season.

In the European Monetary Union (EMU), monetary policy is determined by the European Central Bank (ECB). This arrangement can give rise to certain national economic imbalances that may potentially be addressed through national policies. Traditionally, fiscal policy has been the primary tool to correct these imbalances. However, following the global financial crisis (GFC), a new policy tool has emerged: national macroprudential policies, which aim to mitigate financial risks. This situation raises an intriguing research question: How do macroprudential and fiscal policies interact? Through their influence on real interest rates and economic activity, discretionary macroprudential policies can impact the trajectory of public debt and may necessitate fiscal adjustments, such as tax rate increases, to stabilize the public debt-to-GDP ratio. In a monetary union, a domestic macroprudential shock generates significant cross-border financial effects and also influences the fiscal stance of foreign countries. Furthermore, discretionary government spending policies have an impact on housing prices and households debt. Therefore, the responsiveness of macroprudential policy to changes in housing prices affects the fiscal multiplier.

We assess the macroeconomic and welfare implications of carbon mitigation strategies using an environmental Dynamic General Equilibrium model. The economy uses energy from both green renewable technologies and fossil fuels. We set an emission reduction target in line with the Paris Agreement and analyze the welfare and macroeconomic impacts of various strategies, including (1) raising the domestic price of fossil fuels, (2) implementing a subsidy on green investment funded through lump-sum taxes, (3) imposing taxes on emissions with rebates to households, and (4) utilizing emission taxes to support green investment. Our model provides a framework for evaluating the welfare consequences of various carbon mitigation strategies, emphasizing the need to balance the short and long-term effects of incentives for investment and innovation in green technologies, as well as taxes and other policies designed to reduce carbon emissions.

Purpose The purpose of this paper is to asses the welfare and macroeconomic implications of three distinct degrowth strategies designed to reduce carbon emissions: penalizing fossil fuel demand, substituting aggregate consumption with leisure and disincentivizing total factor productivity (TFP) growth. Design/methodology/approach Using an environmental dynamic general equilibrium (eDGE) model that incorporates both green renewable technologies and fossil fuels in the production process, this study sets an emissions reduction target aligned with the goals of the Paris Agreement by 2050. Findings The results reveal that the conventional degrowth strategy, wherein a reduction in the consumption of goods and services is compensated with an increase in leisure, may entail significant economic consequences, leading to a notable decline in welfare. In particular, a degrowth scenario resulting from a decline in TFP yields the most pronounced reduction in welfare. Conversely, inducing a reduction in fossil fuel demand by fiscally inflating the price of the imported commodity, despite potential social backlash, exhibits noticeably less detrimental welfare effects compared to other degrowth policies. Furthermore, under this degrowth strategy, the findings suggest that a globally coordinated strategy could result in long-term welfare gain. Originality/value To the best of the authors’ knowledge, this is the first contribution that uses an eDGE model to evaluate the welfare implications of an additional degrowth strategy amidst the ongoing inertial reduction of carbon emissions.

This paper evaluates the macroeconomic effects of taxes on banking in a small open economy in a currency union such as the euro area for three tax alternatives: an additional tax on profits, on deposits, and on loans. We propose a DSGE model with rich detail of taxes and a banking sector and show that these three taxes are equivalent in their effects on macroeconomic variables. Banks react to higher taxes by increasing their mark-ups and by transferring part of the fiscal cost to households and firms through higher interest rates on loans, increasing the costs of financial intermediation. The increase in government revenues comes at a cost of a long-run decrease of GDP, an increase in loans interest rates, and a reduction in the volume of credit, deposits and bank capital. Our simulation exercises show that the trade-off between government revenues and economic activity is well captured by a multiplier of GDP to ex post government revenue close to -1, which is virtually independent of the tax rate.

The co-movements of labor productivity with output, total hours, vacancies and unemployment have changed since the mid 1980s. This paper offers an explanation for the sharp break in the fluctuations of labor market variables based on endogenous labor supply decisions following the mortgage market deregulation. We set up a search model with efficient bargaining and financial frictions, in which impatient borrowers can take an amount of credit that cannot exceed a proportion of the expected value of their real estate holdings. When borrowers' equity requirements are low, the impact of a positive technology shock on the marginal utility of consumption is strengthened, which in turn results in lower hours per worker and higher wages in the bargaining process. This shift in labor supply discourages firms from opening vacancies, reducing the impact of the shock on employment. We simulate the effects of an increase in both the loan-to-value ratio and the share of borrowers in total population. Our exercise shows that the response of labor market variables might have been substantially affected by the increase in household leverage in the US in the last twenty years.

In this paper we use a theoretical model of effort optimization on the part of university students to simulate the effects of different tuition fees schemes. For each of such schemes, we present and discuss the trade-offs that appear among the three outcomes that every exercise of policy evaluation in this context should take into consideration, namely, efficiency - that is, student effort-, student welfare and university revenues. To this end, we depart from the tuition fees policy change that took place in the Spanish public university system in year 2012 and compare it with alternative tuition fees designs. Among other results we find that a design with very low entry fees and high penalty cost for failing the exams is the most suitable one in terms of efficiency and university revenues.

Frente a la inflación importada, la tasa de crecimiento del deflactor del PIB es un indicador más apropiado que la inflación calculada a partir del IPC para monitorizar en qué medida nuestra economía genera presión adicional sobre el crecimiento de los precios y para servir de base para un potencial pacto de rentas. En este artículo utilizamos un modelo de equilibrio general dinámico estocástico, estimado para la economía española, con el que evaluamos la contribución de los principales factores que determinan la evolución del deflactor del PIB y los salarios reales desde el inicio de la pandemia.

Using households' balance-sheet composition in the Panel Survey of Income Dynamics, we identify six household types. Since 1999, there has been a decline in the share of patient households and an increase in the share of impatient households with negative wealth. Using a six-agent New Keynesian model with search and matching frictions, we explore how changes in households' shares affect the transmission of government spending shocks. We show that the relative share of households in the left tail of the wealth distribution plays a key role in the aggregate marginal propensity to consume, the magnitude of fiscal multipliers, and the distributional consequences of government spending shocks. While the output and consumption multipliers are positively correlated with the share of households with negative wealth, the size of the employment multiplier is negatively correlated. Moreover, our calibrated model can deliver jobless fiscal expansions.

Purpose This paper aims to analyse the stabilizing macroeconomic effects of economic policies during the COVID-19 crisis in Spain. Design/methodology/approach The contribution of the structural shocks that explain the behaviour of the main macroeconomic aggregates during 2020 are estimated, and the effects of economic policies are simulated using a dynamic stochastic general equilibrium (DSGE) model estimated for the Spanish economy. Findings The results highlight the importance of supply and demand shocks in explaining the COVID-19 crisis. The annual fall in gross domestic product (GDP) moderates at least by 7.6 points in the most intense period of the crisis, thanks to these stabilizing policies. Finally, the potential effects of Next Generation EU in the Spanish economy are estimated. Assuming that Spain may receive from the EU between 1.5 and 2.25 percentage points (pp) of GDP, activity could increase to between 2 and 3 pp in 2024. Originality/value To the best of the authors’ knowledge, the exercises and findings are original. All these results show the usefulness of a DSGE model, such as the estimated rational expectation model for Spain, as a practical tool for the applied economic analysis, the macroeconomic assessment of economic policies and the understanding of the Spanish economy.

En este Observatorio se evaluan los factores que explican el comportamiento ciclico de la economia espanola durante 2020 y el primer trimestre de 2021. Para ello, se utilizan los datos observados hasta 4T2020 y las estimaciones en tiempo real para 1T2021 de BBVA Research (2021), exogenas al modelo. En concreto, se estiman las principales perturbaciones estructurales que explican el crecimiento del PIB, el consumo y la inversion por persona en edad de trabajar (PET) durante 2019, 2020 y 1T2021.

University students have been particularly affected by the COVID-19 pandemic. We present results from the first wave of the Global COVID-19 Student Survey, which was administered at 28 universities in the United States, Spain, Australia, Sweden, Austria, Italy, and Mexico between April and October 2020. The survey addresses contemporaneous outcomes and future expectations regarding three fundamental aspects of students' lives in the pandemic: the labor market, education, and health. We document the differential responses of students as a function of their country of residence, parental income, gender, and for the US their race.

This paper presents a new macroeconomic database for the Spanish economy, REMSDB. The construction of this database has been oriented to conducting medium-term simulations for policy evaluation with the REMS model, a large Rational Expectations macroeconomic Model for Spain. The paper provides a detailed description of the data and documents its main statistical properties. The database is thought to be of major interest to related applications,whether strictly associated with the REMS model or, rather, with empirical macroeconomic studies.

En este Observatorio se evaluan los factores que explican el comportamiento ciclico de la economia espanola entre el segundo trimestre de 2020 y el de 2021. En concreto, se estiman las principales perturbaciones estructurales que explican el crecimiento del PIB por persona en edad de trabajar (PET), el deflactor del PIB y los salarios reales. El foco se centra en el segundo trimestre de 2021 pues, al medirse las variables en terminos de tasas de crecimiento interanuales, recoge el efecto sobre la suma de tasas de crecimiento intertrimestrales desde el Gran Confinamiento.

We investigate the marked gender imbalance across subfields in economics and connect it with the relative scarcity of female students enrolling in economics. First, tracking authorship in the American Economic Association annual meetings, we find sharp gender imbalances across areas of research. When does this imbalance start? Using administrative data, we find gender differences in academic performance across subfields emerging as early as the undergraduate level. Finally, survey data reveal students' gendered preferences that help explain our findings. These gender biases in terms of visibility, performance, and preferences across subfields provide a potentially relevant explanation for the overall gender imbalance in economics.

This paper focuses on the economic consequences of the Covid pandemic in Spain and on what should be done to mitigate them. After briefly describing the channels through which the virus affects economic activity, we provide some data on the evolution of output and employment during the pandemic and on its incidence on public finances. In the final part of the paper we discuss the main measures that have been taken to mitigate the economic consequences of the health crisis and conclude with some reflections on what else should be done. We emphasize the need to build a broad social and political consensus on the key elements of economic policy over the next few years and outline a strategy to deal with the crisis that combines short and long-term measures to speed up the recovery and set the foundations for future growth.

En esta nota se ofrece una primera estimacion de urgencia del impacto economico de la pandemia de coronavirus en Espana y de algunas de las medidas que se estan tomando para mitigar sus efectos utilizando el modelo EREMS. En un escenario base relativamente optimista en cuanto a la duracion del confinamiento y la intensidad de sus efectos sobre la utilizacion de la capacidad productiva, se estima que la crisis sanitaria reducira el crecimiento del PIB en 2020 en algo menos de seis puntos en relacion a un escenario sin pandemia, lo que supondria una caida de este agregado de algo mas de 4 puntos si no se tomasen medidas paliativas. La suspension de la regla fiscal europea, el programa de compra de activos del BCE, la concesion de avales publicos y el resto de medidas anunciadas hasta el momento por el Gobierno pueden ayudar a mitigar significativamente la caida del PIB y del consumo y contribuir a una recuperacion mas rapida, aunque al coste de un importante aumento del deficit publico.

En este Observatorio se evaluan los factores que explican el comportamiento ciclico de la economiaespanola durante la crisis del COVID-19.

El presente informe de la Comision de asuntos tributarios del Grupo de Trabajo Mixto Covid-19 propone medidas de corto y largo plazo. Una vez la recuperacion comience a afianzarse, se recomienda introducir un recargo extraordinario de caracter temporal sobre el IRPF con el fin de ayudar a sufragar parte de los gastos extraordinarios asociados a la crisis. A medio y largo plazo, se aboga por una reforma en profundidad de nuestro sistema tributario que, en combinacion con medidas de racionalizacion del gasto, permita eliminar el persistente deficit estructural de nuestro pais de la forma mas eficiente posible. Esta reforma exigira una ampliacion de las bases tributarias mediante la eliminacion de beneficios fiscales y regimenes especiales, un acercamiento de los tipos de gravamen de los impuestos especiales a los establecidos en muchos paises europeos y un mayor desarrollo de la fiscalidad ambiental y del pago por uso.

El presente documento es el primero de los informes del Grupo de Trabajo Mixto Covid-19. El informe se centra en la necesidad de preservar la estabilidad macroeconomica y presupuestaria como parte de una estrategia para salir de la crisis y mejorar el desempeno de la economia espanola que deberia ser fruto de un amplio pacto economico y social.