Philip Bunn’s research while affiliated with Bank of England and other places

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Publications (28)


High Hurdles: Evidence on Corporate Investment Hurdle Rates in the United Kingdom
  • Preprint

January 2025

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1 Read

Krishan Shah

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Philip Bunn

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Marko Melolinna






Firm Inflation Uncertainty

May 2023

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58 Reads

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1 Citation

AEA Papers and Proceedings

We introduce a new measure of own-price inflation uncertainty using firm-level data from a large and representative survey of UK businesses. Inflation uncertainty has increased significantly since the start of 2021, even as a similar measure of sales uncertainty has declined. We also find large cross-sectional differences in inflation uncertainty, with uncertainty particularly elevated for smaller firms and those in the goods sector. Finally, we show that firms that are more uncertain about their own price expectations experience higher forecast errors 12 months later. These findings suggest that inflation uncertainty may be important for understanding firm performance.


The Impact of Covid-19 on Productivity

February 2023

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107 Reads

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55 Citations

Review of Economics and Statistics

We analyse the impact of Covid-19 on productivity using data from an innovative monthly firm survey that asks for quantitative impacts of Covid-19 on inputs and outputs. We find total factor productivity (TFP) fell by up to 6% during 2020-21. The overall impact combined large reductions in ‘within-firm’ productivity, with offsetting positive ‘between-firm’ effects as less productive sectors, and less productive firms within them, contracted. Despite these large pandemic effects, firms' post-Covid forecasts imply surprisingly little lasting impact on aggregate TFP. We also see significant heterogeneity over firms and sectors, with the greatest impacts in those requiring extensive in-person activity.




Citations (19)


... Moreover, Tanaka et al. (2020) also show that larger and more cyclical firms make forecasts closer to professionals forecasters, providing relief on our underlying assumption that market participants expectations may proxy firm's expectations. More recently, Yotzov et al. (2024), using a survey of UK firms, show that firms respond to positive inflation news by revising downward their expected real sales and revising upward their expected unit production costs. ...

Reference:

Decoding Equity Market Reactions to Macroeconomic News
The Speed of Firm Response to Inflation
  • Citing Article
  • January 2024

SSRN Electronic Journal

... Covid-19 has sped up the digitalisation of work, increasing the divide between workers that could stay at home, log into Zoom or other digital platforms and those that had to physically be in a workplace (Jaumotte et al., 2023). Even in the heartland of Silicon Valley, the tech industry is struggling to convince workers to return to the workplace without strong incentives and debates continue on what the impact has been on productivity (Bloom et al., 2023). Digitalisation has also problematised the locality of work, allowing some workers to work for employers based in states that they are not resident of, resulting in a cascading of difficulties for social protection, tax and welfare regimes that are very much orientated around the state (Deganis et al., 2021). ...

The Impact of Covid-19 on Productivity
  • Citing Article
  • February 2023

Review of Economics and Statistics

... A second issue is the extent to which inflation is driven by demand-side factors, supply-side factors (including increased pricing margins of oligopolistic sellers) or global factors. The irony here is that various major central banks published evidence in 2022 or 2023 that for the most part inflationary pressures were being driven by limited supply, the pandemic, war, and possibly climate change, in a global economy with long, complex, and fragile supply chains, and not by fiscal policy, low interest rates, and other monetary measures (Beckers et al., 2023;Bunn et al., 2022;Shapiro, 2022). ...

Firming up price inflation
  • Citing Article
  • January 2022

SSRN Electronic Journal

... The initial reaction of US financial and housing markets to the COVID-19 outbreak were sharply negative, as this pervasive shock disrupted the health and security of individuals, thereby extending to entire socio-economic systems [3][4][5][6]. So why the rapid turnaround in these markets in the second half of 2020? ...

COVID-19 Uncertainty: A Tale of Two Tails
  • Citing Article
  • January 2021

SSRN Electronic Journal

... This study thus highlights the uncertainty in business that this type of the crisis has caused. As economic uncertainty is difficult to measure objectively, some studies have employed subjective indicators (Altig et al., 2020). Following those studies, we define business uncertainty as "the perception of current business uncertainty" and "the unpredictability of future sales," referring to the former as current business uncertainty and the latter as future business uncertainty. ...

Economic Uncertainty Before and During the COVID-19 Pandemic
  • Citing Article
  • January 2020

SSRN Electronic Journal

... In countries such as Germany and France, where people are looking for larger homes with more outdoor space, the pandemic has led to an increase in housing prices (Mattarocci, 2020). However, in other countries such as Spain and Italy, the pandemic has led to a decline in housing prices due to the economic uncertainty and job losses (Altig, 2020). According to a report by the European Mortgage Federation, the housing prices in the Eurozone declined by 1.8% in 2020. ...

Economic Uncertainty Before and During the Covid-19 Pandemic
  • Citing Article
  • November 2020

SSRN Electronic Journal

... They also found that new investments from the EU to the United Kingdom fell by about 9% following the referendum. Bloom et al. (2019) exploited the Decision Maker Panel, a survey that collects data on several thousand firms on a monthly basis, to assess the investment and productivity implications of the substantial surge in uncertainty caused by the Brexit referendum. Their findings suggest that the anticipation of Brexit was associated with a gradual decline in investment of 11% in the 3 years following the referendum. ...

The Impact of Brexit on UK Firms
  • Citing Article
  • January 2019

SSRN Electronic Journal

... The "unique field experience" of studying the creative industries' overseas business during a period of exceptionally high international trade policy uncertainty became a central feature of this study (Baker et al., 2016b;Baker et al., 2021b;Bloom et al., 2019;Bloom et al., 2020). No trade policies had changed, and it was unclear whether or not they would change, but was policy uncertainty itself affecting the international trade of creative industries SMEs? ...

The Impact of Brexit on UK Firms
  • Citing Article
  • January 2019

SSRN Electronic Journal

... We acknowledge other sources of policy uncertainty during the period of our investigation and the fact that we cannot isolate the impact of Brexit. However, Bloom et al. (2019a) suggest that within two years after the Brexit referendum, which is used in the present study as the period of Brexit uncertainty, the Brexit-induced uncertainty remained high for British firms, suggesting that this potential caveat may not diminish the validity of our findings. Future studies may explore the role of Brexit in other auditing factors such as timeliness of audit opinion delivery and type of auditor opinion. ...

Brexit and Uncertainty: insights from the Decision Maker Panel
  • Citing Article
  • January 2019

SSRN Electronic Journal

... Britain's trade relations with the The post-Brexit EU starts from the position that tariffs could rise above existing commitments if negotiations fail. According to Bloom et al. (2018), the uncertainty of Brexit is increasing. Research by Hassan et al. (2024) explains that companies-international (non-UK) companies are most affected by Brexit uncertainty (second moment), significant loss of market value and reduced hiring and investment. ...

Brexit and Uncertainty: Insights from the Decision Maker Panel
  • Citing Article
  • December 2018

Fiscal Studies