The CEPII Newsletter       
February 2021        



The French edition is slightly different as it also includes material available in French only  

Europe Monnaie & Finance Trade & Globalization Migrations Economic Policy Emerging Economies Competitivness & Growth Environment & Natural Ressources
  Focus

World Interest Rates and Macroeconomic Adjustments in Developing Commodity Producing Countries

How world interest rate shocks impact small open economies? Because of financialisation of commodities, commodity prices are an additional channel through which interest rate shocks are transmitted internationally. Authhors build on a standard model for a small open economy including the competitive storage mechanism of commodities. They find that the endogenous response of commodity prices amplifies the response of commodity-exporting countries to international monetary shocks. Because of the commodity price channel, even small open commodity-exporting economies that are disconnected from international financial markets can be affected by international financial shocks. By Vincent Bodart, François Courtoy and Erica Perego.
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Wealth and Shifting Demand Pressures on the Price Level in England After the Black Death

The wealth effect of the Black Death on the price level continued for generations, up to 1450, following the outbreak of plague in 1348-51, as shows a new CEPII Working Paper. Indeed, in absence of consideration of the wealth effect, other influences on the price level do not even appear in the econometric analysis. The separate roles of coinage, population, trade, wages and annual number of days worked for wages all also receive attention and new results follow for adjustment in the labor market. By Anthony Edo and Jacques Melitz.
 
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  Facts & Figures

One Nation, One Language? Domestic Language Diversity, Trade and Welfare

Using new data on linguistic diversity across and within countries, the publication examines novel channels though which language affects trade patterns and economic welfare. Authors find that linguistic similarity within a country accounts for about 10% of estimated 'home bias', demonstrating the importance of shared languages for domestic integration. Authors illustrate the effect of changing domestic linguistic diversity on trade simulating the repeal of Quebec’s Bill 101 which made French an official language in Canada.

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  Video podcast | Online discussion "The consequences of the pandemic on the French economy : a view from the IMF"

The IMF presents its recently released report on the French economy and financial sector that analyses the impact of the health crisis and the lockdown measures, evaluates the policies that the French authorities have implemented so far and list IMF's recommendation for the near future on the progressive targeting of support measure, the switch from government loan guarantees to incentivised equity financing and the promotion of Green investment.

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  Vidéo podcast | “How to revitalize the multilateral trading system?” CEPII & CEPR webinar
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  "International Trade: The New Normal" workshop and call for papers

On 10 and 11 June 2021 in Paris, the Banque de France, CEPII, CEPR and University of Surrey are jointly organising a workshop to explore economic dimensions of the “new normal” environment of international trade, which has been severely impacted by recent events and associated rises in trade costs. Increases in tariffs and sanctions (e.g. U.S-China trade war), globalisation backlash, institutional challenges (e.g. Brexit, WTO), and Covid-19 are imposing a rethinking of multilateral trade and the way that firms organise production across borders. Empirical as well as theoretical contributions that analyse the consequences of this new normal situation with an emphasis on a policy perspective are welcome. Please submit them before 28 February 2021.

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ISSN: 1255-7072
Editorial Director : Sébastien Jean
Managing Editor : Evgenia Korotkova