Centre for Economic Policy Research

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CEPR, established in 1983, is an independent, non‐partisan, pan‐European non‐profit organization. Its mission is to enhance the quality of policy decisions through providing policy‐relevant research, based soundly in economic theory.

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In New Zealand, the Māori Advisory Committee advises on whether registration of a trademark incorporating Māori signs is likely to be offensive. This raises the cost of entry in New Zealand but increases the value of existing trademarks there.
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The figure plots event-study coefficients from a linear probability model where the outcome equals one if the trademark is successfully registered and zero if abandoned, cancelled, rejected, or withdrawn. Across food, tourism, cosmetics, and luxury goods, indigenous language and heritage increasingly anchor premium market positions, but when it comes to trademarks, few jurisdictions have developed national rules to explicitly protect and preserve traditional knowledge. This column looks at the case of New Zealand, where the Māori Advisory Committee advises the Commissioner of Trademarks on whether registration of a trademark incorporating Māori signs is likely to be offensive to Māori. This embedded collective governance mechanism raises the cost of new entry in New Zealand but increases the value of existing trademarks held there.
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Hakim El Karoui & Marc Reverdin make the case for a Mediterranean Community of Human Capital, built around joint investment in training, skills, and mobility, thereby expanding the skills base and reducing brain drain.
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Europe's shrinking workforce is weighing on its productivity and welfare systems. Meanwhile, its southern Mediterranean neighbours currently produce growing numbers of graduates whom domestic labour markets cannot absorb. This column makes the case for a Mediterranean Community of Human Capital, built around joint investment in training, skills, and mobility, which could expand the skills base, reduce brain drain, and rebuild trust with Europe’s closest neighbours.
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Olivier Accominotti, Jason Cen, David Chambers, and Victor Degorce argue that covered interest parity deviations are not a recent phenomenon and have, in fact, been the norm over the past 60 years, with the notable exception of the years immediately preceding the GFC.
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This figure plots the 30-day moving average of the three-month US dollar basis for the British pound between 1968 and 2025, measured in basis points. The USD basis is defined as the difference between the three-month US dollar offshore Eurocurrency deposit rate and the synthetic USD interest rate obtained when swapping British pounds into US dollars. For visual clarity, the vertical axis is truncated at ±60 basis points.
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Reform of European financial markets has stalled due to systemic bias in favour of nationally anchored universal banks. The ECB can take this opportunity to reform its operational and liquidity framework, helping to encourage the development of a market in euro-denominated tokenised instruments.

Europe needs deeper, more competitive financial markets to finance innovation and common public goods, but reform has stalled because of a systemic bias in favour of nationally anchored universal banks. This chapter argues that innovation in financial markets creates an opportunity to weaken this bias, and that the ECB can take this opportunity by reforming its operational and liquidity framework. Access to central-bank money should follow economic function, not the legal form of the bank. Regulated European issuers of euro money should be able to hold their backing at the Eurosystem, and market-based intermediaries should have access to liquidity in times of stress. At the same time, the ECB should supply reserves mainly through outright holdings rather than collateralised lending and should privilege the treatment of common debt over national debt. These changes would not substitute for pension reform or legal harmonisation. But they are within the ECB's reach now, and they would help determine whether new savings flow into contestable markets or a larger bank-centred system. They would also help to encourage the development of a market in euro-denominated tokenised instruments, which would allow the settlement layer of tokenised finance to be built in euros.
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📢 #CallForPapers BIS – CEPR – GERZENSEE – SFI Conference on Financial Intermediation 2027
Study Center Gerzensee | 2-5 May 2027
⌛Deadline: 20 Nov 2026
Organisers: Christoph Basten, Diana Bonfim, Sebastian Doerr, @fuster.bsky.social, Emilia Garcia-Appendini, Thomas Nellen
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BIS - CEPR - Gerzensee - SFI Conference on Financial Intermediation 2027 Hosted by the Study Center Gerzensee (Foundation of the Swiss National Bank). When: 2–5 May 2027 This conference brings together globally leading researchers to present their latest work on financial intermediation and related areas, covering both empirics and theory. The conference is committed to promoting diversity in the covered topics (including non-bank financial institutions, macro-finance, climate/green finance, household finance, and fintech), in the modelling techniques and data sets employed, and in participants’ background. Deadline: 20 November 2026 Organisers: Christoph Basten, Diana Bonfim, Sebastian Doerr, Andreas Fuster, Emilia Garcia-Appendini, Thomas Nellen
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The case of Bhutan shows that cultural norms matter for macroeconomic development. Four decades of data show that rapid income growth remains weakly associated with measured happiness, and that only by embedding the wellbeing measure in local cultural norms does it become effective.

Interest in the role of cultural norms, institutions, and development has resurfaced in recent years especially post the 2024 Nobel Prize in Economics. This column revisits Bhutan, which has pursued ‘gross national happiness’ rather than GDP since the 1970s. Four decades of data show that rapid income growth remains only weakly associated with measured happiness, even as multidimensional wellbeing has continued to rise alongside growth. The broader lesson is that a wellbeing measure becomes effective only if it is embedded in local cultural norms and given institutional teeth, showcasing the importance of cultural norms to economic development.
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S Maria Bonin, S Darougheh, & A Kuchler find evidence that the adoption of AI is impacting the Danish labour market, even though the effect is not visible in aggregate statistics. They show that early adopters of AI fall behind their own pre-adoption employment trend.
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Log employment (full-time equivalents) of firms first using AI in 2023 (left panel) or 2024 (right panel), relative to firms reporting no AI use, each measured against a firm-specific linear trend; within three-digit industry × month. Left panel: trend estimated on 2020–2021, so 2022 is out of sample; indexed to January 2023. Right panel: first-time 2024 adopters compared with firms reporting no AI use through 2024; trend estimated on 2021–2022; indexed to January 2024. Shaded areas are 95% confidence bands. The vertical axis is in log points (−0.1 ≈ −10%). Survey-weighted. Policymakers are asking whether generative AI is reshaping labour demand, and the literature has found mixed results so far. This column links Denmark’s official IT-use survey to monthly employer–employee records and compares firms that started using AI in 2023 with those that did not. Early adopters fall behind their own pre-adoption employment trend. The decline is most visible in AI-exposed jobs and among new hires, and only significant among small firms. The results indicate that AI is affecting the labour market, even though the effect is not visible in the aggregate statistics.
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The CEPR Virtual Industrial Organisation Seminar #VIOS Series continues on 14 October at 15:00 CEST featuring Anais Fabre @cornelluniversity.bsky.social presenting: 'Sequential College Admission Mechanisms and Off-Platform Options'
Discussant: Daniel Waldinger (NYU)
Register: ow.ly/qLG350ZQsM2

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Marco Pinchetti shows that while geopolitical shocks transmitted through energy markets raise prices and depress economic activity, geopolitical shocks unrelated to energy markets reduce inflation instead.
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The graph shows the geopolitical risk index and the WTI oil price from 1985-2025. GPR = Geopolitical Risk Index of Caldara and Iacoviello (2022). WTI is the West Texas Intermediate oil price, deflated by the US consumer price index. Geopolitical tensions are often seen as a source of inflation. But this is only part of the story. This column shows that geopolitical shocks transmitted through energy markets raise prices while depressing economic activity. But geopolitical shocks unrelated to energy markets reduce inflation instead. These two shocks can be identified based on oil prices and geopolitical risk dynamics around major geopolitical events.
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Worker-managed firms are a remedy for rising income inequality & protect social cohesion by increasing employees' bargaining power & providing an enhanced sense of self-worth. Data suggest well-designed co-ops compete with conventional firms in free markets with no evidence of a productivity gap.

Rising income inequality in Western high-income countries threatens democratic governance and social cohesion, and AI risks making it worse. Drawing on a forthcoming book, this column argues for worker-managed firms as a durable remedy. With no external owners taking profits, worker cooperatives protect against the rising bargaining power of employers and provide an enhanced sense of self-worth and self-determination for employees. Furthermore, the data suggest that well-designed worker cooperatives compete with conventional firms in free markets with no evidence of a productivity gap. Because they are underprovided by the market, it calls for government action to support worker cooperatives.
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S Reyes Ortega, K Freeman, P Hernando-Kaminsky, J Huber, & @paolomauroecon.bsky.social use data from 150 economies to study how venture capital financing differs across countries. Most of the cross-country gap is associated with how many startups enter the pipeline rather than their funding.

This figure compares the average sectoral distribution of VC volume within countries across high-income and low- and middle-income countries over 2012–2023. For each income group, the figure reports the average share of total VC volume accounted for by each selected sector, weighted by country GDP. The first three sectors—IT, Services–R&D, and Manufacturing–Chemicals and Pharmaceuticals—are sectors in which the average VC share is higher in high-income countries, whereas the remaining three sectors—Wholesale and Retail, Financial Services, and Transportation and Logistics—are sectors in which the average VC share is higher in low- and middle-income countries. Existing views on what venture capital finances and how its markets are structured are primarily shaped by the experience of the US and a few other high-income economies. This column presents evidence covering nearly 270,000 venture capital-backed startups in over 150 economies to provide a more complete picture. Venture capital markets differ across countries in size and also in kind. At lower levels of economic development, the composition tilts away from knowledge intangibles towards organisational intangibles. Yet differences in what venture capital finances tell only part of the story. Most of the cross-country gap in venture capital activity is associated with how many startups enter the funding pipeline rather than how much each raises.
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7 October 17:00 CEST International Macro History Online Seminar #IMHOS
🗣️Marco Tabellini (Harvard Business School & CEPR) presents 'Climate Matching, European Overseas Settlements, and Long-Run Development'
Chair: @luigipascali.bsky.social (LUISS Guido Carli & CEPR)
✍️ ow.ly/XW8p50ZKirk

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David Vines & John Llewellyn use a game theoretical lens to develop a new framework for global cooperation in a world after US hegemony. Using historical examples, they flesh out the coalition-of-the-willing logic that has gained traction in recent years.
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The era of US-led global economic leadership is over, almost certainly permanently, and Europe needs a new framework for cooperation to match. Writing for CEPR's Europe 2050 series, David Vines (Oxford) and John Llewellyn (Independent Economics) argue that the "Prisoner's Dilemma" lens long used to think about international cooperation, where each country is tempted to defect and let others bear the burden, has never fitted reality well and matters less now. They propose thinking instead in terms of a "Stag Hunt": a game with two stable outcomes, coordinate-coordinate or each-for-themselves, in which the gains from cooperating are large enough that countries have a genuine incentive to commit, provided there is trust, flexibility and some capacity for enforcement. The practical mechanism they propose is "Concerted Unilateralism": countries agree collectively on who should do what, then each delivers its agreed role independently. They illustrate the concept with contrasting European cases, Airbus's successful 1967 work-share agreement against the collapse of the Franco-German-Spanish FCAS fighter jet programme over disputes on industrial leadership, and argue the same logic could unlock stalled European priorities like Capital Markets Union and a genuinely joint defence architecture. Looking beyond Europe, they draw a close historical parallel between today's flood of Chinese car exports and Japan's assault on the US auto market in 1980, arguing Europe's likeliest path is a "conditional integration" strategy that allows Chinese manufacturing on European soil in exchange for local production, R&D and technology transfer commitments, rather than tariffs or a straightforward accommodation that risks reducing Europe to an assembly platform. They see the same coalition-of-the-willing logic already working in the Global Combat Air Programme linking Italy, the UK and Japan, and argue it offers the most realistic route to defending the rules-based trading system and maki...
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During banking crises, nonbank financial institutions contract syndicated lending relative to banks but expand corporate bond underwriting. For firms with access to bond markets, relationships with nonbank underwriters can help preserve market-based financing.
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Left panel: corporate bond issuance as a share of corporate bonds and syndicated loans one year before and in the first year of country-specific banking crises, the GFC, and the COVID-19 shock. Right panel: volume-weighted NBFI share of corporate bond underwriting in borrower-country-years without and with a systemic banking crisis. Nonbank financial institutions are often seen as procyclical lenders, cutting credit more sharply than banks during stress, while bond markets can substitute for bank lending when credit supply contracts. This column brings these perspectives together and argues that this cyclicality depends on the function intermediaries perform. During banking crises, nonbank financial institutions contract syndicated lending relative to banks but expand corporate bond underwriting. For firms with potential access to bond markets, we find that relationships with nonbank underwriters can therefore help preserve market-based financing when bank credit is impaired.
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Ruiqi Sun & Daniel Trefler show that AI makes digital services dramatically more attractive, increasing their user base at home and abroad. But when governments restrict the movement of data across borders, the gains from AI are halved.
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The curves show the cumulative distribution of app-level foreign user shares in 2020 through the 60th percentile. Small apps are those at or below the median number of total users. AI is transforming digital services, and mobile apps, which routinely reach users far beyond their home markets, show just how global that transformation has become. This column shows that AI makes these products dramatically more attractive, increasing their user base at home and abroad by more than threefold. But when governments restrict the movement of data across borders, the gains from AI are halved. This creates a genuine policy tension. Rules designed to protect privacy, national security, and democratic institutions can also make it harder to build better products and spread the gains from new technologies.
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