Publications

Occasional Papers

The Occasional Papers series seeks to disseminate the work carried out by the Banco de España within its sphere of competence that is considered to be of general interest for knowledge of the functioning of the Spanish economy and of its international environment.

The opinions and analyses published in the Occasional Papers are the responsibility of the authors and are not necessarily shared by the Banco de España or the Eurosystem.

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  • 2113
    Los efectos del salario mínimo interprofesional en el empleo: nueva evidencia para España (966 KB) Cristina Barceló, Mario Izquierdo, Aitor Lacuesta, Sergio Puente, Ana Regil and Ernesto Villanueva

    This paper uses different data and approaches to analyse the impact on employment of the increase in the national minimum wage in 2019. It turns out that, following the increase, the employment of low-wage workers grew more slowly. Alternative exercises are carried out focusing on the impact on the workers targeted by the reform. These suggest a larger adverse impact on the job losses of elder workers and a sharper reduction in hours worked and in job creation for younger workers. Finally, using accommodation and food service activities data, the article addresses the difficulties of unequivocally identifying a control group comparable to workers whose wages are at the national minimum level, meaning that the estimated impacts should be interpreted with caution.

  • 2112
    El interés por la innovación financiera en España. Un análisis con Google Trends (1 MB) José Manuel Carbó and Esther Diez García

    This paper examines the differences in interest in financial innovation-related concepts in Spain. We conduct our analysis using Google Trends. This tool enables the intensity of search for a specific term in the Google search engine to be analysed. While the tool does not show searches in absolute terms, it is useful for understanding the relative differences between terms and regions. The results suggest there are differences between Spain’s regions, although these vary depending on the category of financial innovation concerned. The difference is much greater in terms relating to regulation and new technologies applied to sustainable financing, while it is virtually non-existent in the cryptocurrencies and payment means categories. Among the factors that may explain these results, we identify income and age as possible determinants of inter-regional differences. These results may prove useful with a view to developing financial education programmes and to better directing efforts towards those regulatory initiatives in the digital area where the disparity in interest and knowledge may be greater.

  • 2111
    A GPS navigator to monitor risks in emerging economies: the vulnerability dashboard (663 KB) Irma Alonso and Luis Molina

    This paper presents a simple, transparent and model-free framework for monitoring the build-up of vulnerabilities in emerging economies that may affect financial stability in Spain through financial, foreign direct investment or trade linkages, or via global turbulences. The vulnerability dashboards proposed are based on risk percentiles for a set of 34 key indicators according to their historical and cross-section frequency distributions. The framework covers financial market variables, macroeconomic fundamentals –which are grouped into real, fiscal, banking and external variables– and institutional quality and political indicators. This methodology is a valuable complement to other existing tools such as the Basel credit-to-GDP gap and vulnerability indices.

  • 2110
    High-Yield bond markets during the COVID-19 crisis: the role of monetary policy (535 KB) Dmitry Khametshin

    This article documents the difference in corporate bond issuance between the euro area (EA) and the United States (US) in 2020, especially in the high-yield (HY) segment, and discusses the role that the monetary policy measures undertaken by the US Federal Reserve (Fed) and the ECB in response to the Covid-19 crisis may have played in explaining such difference. We document that the issuance of HY bonds since February 2020 has been lower by historical standards in the EA than in the US. The Fed’s measures aimed at the HY segment, mainly the purchase of HY bond exchange traded funds (ETFs), could have reduced credit spreads and improved market liquidity, which in turn could have stimulated debt issuance. Alternatively, HY issuers in the EA may have faced better bank funding conditions due to the ECB’s targeted longer term refinancing operations (TLTRO) and to other measures by national fiscal authorities, leading such issuers to substitute bank credit for bond finance. The article discusses these possibilities and argues that they all may have played a role to a certain extent.

  • 2109
    The relationship betweem pandemic containment measures, mobility and economic activity (742 KB) Corinna Ghirelli, María Gil, Samuel Hurtado and Alberto Urtasun

    This paper first constructs a regional-scale indicator that seeks to gauge the volume of measures implemented at each point in time to contain the pandemic. Using textual analysis techniques, we analyse the information in press news. At the start of the pandemic, measures were taken in a centralised fashion; but from June, regional differences began to be seen and increased in the final stretch of the year.
    Second, using linear estimates, with monthly data and a level of regional disaggregation, the paper documents how most of the reduction in mobility observed in Spain has been due to the restrictions imposed. However, there has been a perceptible change in this relationship over recent months. In the early stages of the pandemic, the reduction in mobility was found to be greater than would be inferred by the restrictions approved. That is to say, at the outset there was apparently some voluntary reduction in mobility. Yet following lockdown-easing, the behaviour of mobility has fitted more closely with what might be attributed to the containment measures in force.
    Finally, the findings in the paper suggest that most of the decline in economic activity since the start of the crisis can be explained by the reductions observed in mobility. The analysis considers only the short-term effects on activity, which is very useful for preparing the projections on GDP behaviour in the current quarter. Conversely, the methodological approach pursued does not allow for evaluation of the effect of the pandemic containment measures on activity over longer time horizons. In particular, the adverse impact on the economy’s output that occurs concurrently as a result of the restrictions may be countered in the medium term by an effect of the opposite sign, to the extent that the restrictions imposed today may serve to prevent other more forceful ones in the future.

  • 2108
    Real-time analysis of the revisions to the structural position of public finances (3 MB) Pablo Burriel, Víctor González-Díez, Jorge Martínez-Pagés and Enrique Moral-Benito

    Estimating the role of the business cycle on the General Government budget balance plays a key role on the real-time analysis of fiscal policy, especially under the Stability and Growth Pact framework. This paper studies, for a group of EU countries and the United Kingdom, the revisions in the structural balance estimated by the European Commission between its first publication and the most recent figures. The results suggest that revisions were negative (i.e. the budget balance measured ex-post is, on average, less favourable than assessed in real time) and significant for the period prior to 2008, but relatively smaller for later years. Overall, revisions are procyclical but negative on average. Furthermore, data revisions (on public expenditure and revenues as well as GDP growth) are as important as errors in estimating the unobservable potential GDP. According to these findings, the structural efforts required by the EU framework were in general insufficient during the boom up to 2008, since they were based on too optimistic estimates of the structural balances. However, there is no evidence of similar real-time errors in the assessment of fiscal positions during the crisis and the posterior recovery.

  • 2107
    Dating and synchronisation of regional business cycles in Spain (5 MB) Eduardo Byrés, María-Dolores Gadea and Ana Gómez-Loscos

    The analysis of the regional business cycles in Spain highlights a high degree of similarity in the developments of most regions, but also shows idiosyncratic behaviour that mainly affects the duration and intensity of recessions. Such idiosyncratic behaviour would advise complementing national policies with specific policies aimed at certain territories. This paper adopts two complementary approaches in order to comprehensively date and analyse regional business cycles: the first uses an annual aggregate indicator such as GDP, for which a long series is available; the second focuses on a set of specific monthly indicators for a more recent period and provides a more accurate characterisation of the reference cycle.

  • 2106
    The Spanish pension system: an update in the wake of the pandemic. Banco de España contribution to the Committee on the Monitoring and Assessment of the Toledo Pact Agreements. 2 September 2020 (720 KB) Pablo Hernández de Cos

    In 2017 the Banco de España published an Occasional Paper (DO 1701) describing the institutional framework of the pension system, setting out the main medium-term challenges and analysing some reform alternatives. In this paper the Governor updates the foregoing analysis for the Committee on the Monitoring and Assessment of the Toledo Pact Agreements on the basis of the latest figures and regulatory developments. He considers alternatives for reforming the pension system based on their impact on its financial sustainability and overall public finances; on employment, productivity and the economy’s potential growth; and on the system’s sufficiency and inter- and intra-generational equity.

  • 2105
    The independence of economic authorities and supervisors. The case of the Banco de España. Testimony by the Governor of the Banco de España before the Audit Committee on Democratic Quality / Congress of Deputies, 22 December 2020 (389 KB) Pablo Hernández de Cos

    In his testimony, the Governor’s analysis of the impartiality and autonomy of independent economic authorities contributes to the Committee’s review of the “measures needed to strengthen the impartiality and independence of independent authorities and regulatory agencies”. He first reviews the arguments warranting the independence of economic authorities and supervisors. He then goes on to address the features that conform an institution’s formal independence, detailing their specific form in the case of the Banco de España. Next, he reflects on the status of independence as a necessary, but not sufficient, condition for the proper performance by independent agencies of their functions. He then highlights possible measures for strengthening the independence of the Banco de España, and identifies potential improvements to the financial supervision model in Spain. Lastly, he refers to the Bank’s control mechanisms and transparency standards, and certain aspects of its governance.

  • 2104
    Draft state budget for 2021. Testimony before the Parliamentary Budget Committee, 4 November 2020 (954 KB) Pablo Hernández de Cos

    In discussing the first Draft State Budget to address the economic and social impact of the COVID-19 pandemic, the Governor begins with an analysis of the economy’s recent behaviour and how it may evolve in the coming quarters, drawing on the Banco de España’s projections. Against this background, he assesses the Government’s macroeconomic forecast underpinning the Draft State Budget. He proceeds to calibrate the Budget’s main proposals in terms of the fiscal policy stance, the composition and appropriateness of public revenue and expenditure, and the risks to meeting the budget deficit target. Lastly, he sets out what he considers to be the key challenges for Spanish fiscal policy in the medium term.

  • 2103
    Cyclical patterns of the Spanish economy in Europe (974 KB) Luis J. Álvarez, M.ª Dolores Gadea and Ana Gómez Loscos

    The main aim of this paper is to provide a set of stylised facts on the regularities of cyclical patterns in Spain compared with those of the major European countries and to analyse the synchronisation of the main real variables of these economies, which have close trading and financial relationships. A sectoral approach is used to take into account the heterogeneous behaviour of the different supply and demand components.

  • 2102
    Taxation challenges of population ageing: comparative evidence from the European Union, the United States and Japan (684 KB) Fructuoso Borrallo, Susana Párraga-Rodríguez and Javier J. Pérez

    Using microdata from the European Union, the United States and Japan, we show that the elderly bear lower effective tax rates than the young. This difference is explained by the income gap and the different generational consumption baskets. However, tax reforms enacted in recent decades have led to an increase in the relative contribution of the elderly to public finances.

  • 2101
    Una taxonomía de actividades sostenibles para Europa (556 KB) Luna Azahara Romo González

    The EU Taxonomy for sustainable activities was created with the goal of becoming a crosssectional law for all current and future EU regulations on sustainable finance. The initial
    proposal for an EU Taxonomy was in 2018, and the final regulation, containing its basic
    principles and foundations, was released in June 2020. In this article I describe the main
    characteristics of the taxonomy: how it works, its influence on the future EU Green Bond
    Standard and its foreseeable future development. I also reflect on the importance of the
    EU Taxonomy for Central Banks from the standpoint of their investments, the relevance
    of the Taxonomy for the EU and sustainable finance, and the benefits it entails and the
    challenges it poses if companies and investors are to use it. Ultimately, a successful
    implementation of the Taxonomy will be key to Europe achieving its ambitious climate
    and environmental objectives and to future generations enjoying a more sustainable and
    habitable world.

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