Hello, Action Policy Digest readers!

Organized as a monthly newsletter, it presents an overview of the current international policy debate. You find below a selection of the best ideas from the most influential think tanks, structured in four areas: (i) Finance, (ii) Innovation and Development, (iii) European Affairs and (iv) Social Policy.

 “Key features of the ECB’s new monetary policy strategy: A New Keynesian perspective“. Following a comprehensive review, the ECB announced its new monetary policy strategy in July 2021. Two key elements of this new strategy are the symmetry of the inflation target and the use of especially forceful or persistent measures when the economy is close to the effective lower bound.

 “Managing sovereign debts held by the ESCB“. Many economists and policy makers have engaged in the debate on how to manage the sovereign debt portfolio accumulated by the European System of Central Banks (ESCB). These proposals share the common goal of addressing an important and urgent public policy problem but differ in their specific institutional solutions.

 “The private equity industry in the new interest rate environment“. As interest rates shift from a decades-long decline to hovering at the zero lower bound and potentially increasing significantly, the private equity industry will face new pressures. The inflow of capital to the asset class will decelerate, leading to an increased scrutiny of costs and an opportunity to shift bargaining power to limited partners.

 “Why is AI adoption in health care lagging?“. Artificial intelligence (AI) technologies have improved rapidly over the past decade,  largely driven by advances in machine learning, which is closely related to data science and statistical prediction. This connection between machine learning’s capabilities and needs of the health care system has led to widespread speculation that AI will have a large impact on health care.

 “Best before: Personal loss recovery for offline digital cash“. An inconvenient aspect of physical cash is that it can be lost without a way to recover it. This column considers a feature to solve this problem for offline digital cash: automated personal loss recovery through an expiry date.

 “How has growth changed what countries get from the European recovery fund?“. Adjustments to growth forecasts mean some countries will get 10% more than expected and others 20% less in grants from the EU Recovery and Resilience Facility. But the benefits of more quickly rising growth rates dwarf foregone recovery funds.