John C Williams: A time of uncertainty Remarks by Mr John C Williams, President and Chief Executive Officer of the Federal Reserve Bank of New York, at the Griswold Center for Economic Policy Studies 2022 Spring Symposium, Princeton, New Jersey, 2 April 2022. ***  As prepared for delivery Good afternoon, everyone. I'm so pleased to be here at Princeton University. It's great to be able to attend an event like this in person, and to see so many of my esteemed colleagues here today. Whenever I visit a college campus, I am reminded that some of the concepts I learned as a student can become more meaningful over time, often in surprising ways. I've thought of that as I've reflected on the significant challenges we face today-the ongoing pandemic and the Russian invasion of Ukraine. In addition to staggering human suffering, these events are imposing considerable economic and financial hardships around the world. If we think back on what many of us learned in statistics about factor analysis, the pandemic and the Russian invasion can be seen as factors that have common effects across countries. But there are also idiosyncratic components that have distinct effects for the U.S. economy. I'll talk more about that today, as well as give you my views on inflation and the economic outlook. But I want to say at the outset that we at the Federal Reserve are committed to fulfilling our dual mandate of price stability and maximum employment.
The decline of labour market institutions includes lower trade union membership, which reduces the relative bargaining power of labour, and more flexible labour market institutions that can pose challenges See, for example, the effects of the monetary policy pursued by the Federal Reserve in connection with the financial crises in Bivens (2015), the effects of monetary policy in the USA since 1980 in Coiboin (2016), the effects in advanced economies since 1990 in panel data-analyses in Furceri et al. (2016) and effects of the monetary policy conducted by the ECB in connection with and after the financial crises, with a focus on Germany in Bundesbank (2016). 4 One example is that a decline in trade union membership (union rate) reduces the relative bargaining power of labour, exacerbating wage inequality (Frederiksen and Poulsen 2010). Another is that more flexible labour market institutions (although positive for reallocating resources to more productive firms and enabling firm restructuring) can pose challenges for workers, especially those with low skills, and hence play an important role in explaining inequality developments (Alvadero et al 2013). 3  3 [5]  for workers with low skills. Technological progress combined with globalization seems to have played at least some role in increasing inequality within countries. • The discussion of the effects of globalization is interesting. Globalization has for long been a natural part of the Nordic economies. Our dependency on foreign trade is much higher than the global average.