THE MYTH OF GOVERNMENT SPENDING MULTIPLIER

Robert Barro makes (link) a strong case on why Keynesian spending multiplier is a theoretical illusion resulted from the fact that government purchases can be hardly separated from real fluctuations.

THE MOST EDUCATED TOWNS IN THE U.S

Here (link) is an interesting research conducted by Forbes. It is the list and specific charateristics of the most educated towns in the U.S.

OIL SHOCKS AND RECESSION 2008

Those of you who enjoy grasping the macroeconomic reality with both hands and attend advanced macro classes will probably enjoy reading professor Hamilton's posts on the contribution of energy price spike to consumption spending and this year's recession (here and here)

SLOVAKIA ADOPTS EURO

On January 1, 2009, Slovakia left ERM II and became the 16th country of the eurozone (here and here). While fiscal consolidation has been sustained through capped deficit spending, inflationary pressures have been normalized due to substantial currency appreciation which also capped import prices. Reviewing data and macroeconomic forecast (here, here and here), output growth is expected to outperform the average of the Euroarea. Until 2013, output is expected to grow at an annual 5 percent rate. Robust output growth is partly due to continuing real convergence in output per capita and partly as a result of koruna appreciation and inflow of foreign direct investment. However, it will be interesting to observe inflationary pressures over the medium term. It is also essential for policymakers to capture fiscal surplus and set medium-term public spending cap. Nonetheless, competitive labor market is required to soften the inflationary pressures which could deteriorate in case of expansionary monetary policy while output gap is expected to close until 2010 despite robust short-term fluctuations.