Federal Reserve Bank of San Francisco

Displaying 1-40 of 50 results

  • White Papers // Aug 2011

    Dollar Illiquidity And Central Bank Swap Arrangements During The Global Financial Crisis

    While the global financial crisis was centered in the United States, it led to a surprising appreciation in the dollar, suggesting global dollar illiquidity. In response, the Federal Reserve partnered with other central banks to inject dollars into the international financial system. Empirical studies of the success of these e...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Jul 2011

    Bank Relationships, Business Cycles, And Financial Crises

    The importance of information asymmetries in the capital markets is commonly accepted as one of the main reasons for home bias in investment. The authors posit that effects of such asymmetries may be reduced through relationships between banks established through bank-to-bank lending and provide evidence to support this claim. They...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Jun 2011

    Economics Instruction And The Brave New World Of Monetary Policy

    Economics education faces a challenge in keeping up with the changes that have swept through monetary policy in recent decades. Many central banking innovations, such as interest on reserves and large-scale asset purchases, aren't adequately treated in standard textbooks. The following is adapted from a presentation made by the president...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // May 2011

    Fiscal Spending Jobs Multipliers: Evidence From The 2009 American Recovery And Reinvestment Act

    This paper estimates the "Jobs multiplier" of fiscal spending - by sector, by type of spending, and over time - using the state-level allocations of federal stimulus funds from the American Recovery and Reinvestment Act (ARRA) of 2009. Because the level and timing of stimulus funds that a state receives...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Jan 2011

    Consumers And The Economy, Part II: Household Debt And The Weak U.S. Recovery

    The U.S. economic recovery has been weak, especially in employment growth. A microeconomic analysis of U.S. counties shows that this weakness is closely related to elevated levels of household debt accumulated during the housing boom. Counties where household debt grew moderately from 2002 to 2006 have seen a moderation of...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Jan 2011

    The Recent Evolution Of The Natural Rate Of Unemployment

    The U.S. economy is recovering from the financial crisis and ensuing deep recession, but the unemployment rate has remained stubbornly high. Some have argued that the persistent elevation of unemployment relative to historical norms reflects the fact that the shocks that hit the economy were especially disruptive to labor markets...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Jan 2011

    If You Try, You'll Get By: Chinese Private Firms? Efficiency Gains From Overcoming Financial Constraints

    The importance of finances in economic development has long been advocated and empirically tested in the economic literature. As early as 1911, Schumpeter has linked the importance of financial services to firms' capacity in engaging technological innovation and thus a country's ability in economic development. Based on country-level analyses, King...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Jan 2011

    Evidence On Financial Globalization And Crisis: Capital Raisings

    Financial globalization opened international capital markets to investors and firms all over the world. Foreign capital raisings by firms have increased substantially since the early 1990s in terms of equity as well as debt. The author reviews the literature on the determinants and patterns of cross-border capital raisings and their...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Dec 2010

    Supplemental Materials: Do Credit Constraints Amplify Macroeconomic Fluctuations?

    The economy is populated by two types of agents - households and entrepreneurs - with a continuum and unit measure of each type. There are four types of commodities: labor, goods, land, and loanable bonds. Goods production requires labor, capital, and land as inputs. The output can be used for...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Dec 2010

    Building Scale In Community Impact Investing Through Nonfinancial Performance Measurement

    The measurement of nonfinancial performance is becoming increasingly important in the community impact investing industry, where individuals and institutions actively deploy capital in low-income domestic markets for both financial and social returns. Quality data ensure that the creation of jobs, construction of community facilities, financing of affordable housing, and other...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Dec 2010

    Social Metrics In Investing: The Future Depends On Financial Outperformance And Leadership

    In order to truly unlock the potential of the impact investing industry, social/environmental metrics must be directly connected to financial outperformance. When above-market rate - or premium - financial returns are present, large fiduciaries such as public pension plans (who globally hold a total of $23 trillion in assets), are...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Sep 2010

    Global Recovery: Asia And The New Financial Landscape

    On June 7 and 8, 2010, the Federal Reserve Bank of San Francisco's biennial Conference on Asian Banking and Finance considered the "Global Recovery: Asia and the New Financial Landscape." The Conference is the fourth in a series begun in 2007 to examine the role of Asia in global finance....

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Sep 2010

    Job Creation Tax Credits And Job Growth: Whether, When, And Where?

    This paper studies the effects of Job Creation Tax Credits (JCTCs) enacted by U.S. states over the past 20 years. First, the authors investigate whether JCTCs stimulate within-state job growth. Second, they assess from where any increased employment comes from - in-state or out-of-state? Third, they evaluate when JCTCs' effects...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Sep 2010

    Indeterminate Credit Cycles

    The authors present a model with heterogeneous firms, in which credit constraints may give rise to self-fulfilling, sunspot-driven business cycle fluctuations. They derive optimal incentive-compatible loan contracts, under which a firm's borrowing capacity is constrained by expected equity value. Interactions between debt and equity value made possible by credit constraints...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // May 2010

    Rural Banking In China

    China's rural banking market is serviced mainly by four types of financial institutions: a large commercial bank; a policy bank; a postal savings bank; and small and medium sized rural financial institutions (see chart below). Of the major players focused on the rural banking market, small and medium-sized rural financial...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // May 2010

    Financial Crisis And Bank Lending

    The recent financial crisis has severely weakened the U.S. banking industry. The number of bank failures has skyrocketed, and it continues to climb. Bank stocks plummeted. In response to both the great economic recession and the dire conditions of the banking industry, banks tightened their lending terms and standards to...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Apr 2010

    Simple And Robust Rules For Monetary Policy

    This paper focuses on simple normative rules for monetary policy which central banks can use to guide their interest rate decisions. Such rules were first derived from research on empirical monetary models with rational expectations and sticky prices built in the 1970s and 1980s. During the past two decades substantial...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Apr 2010

    The Housing Drag On Core Inflation

    Some analysts have raised the question of whether the unprecedented declines in house values, which have been the hallmark of the recent recession, might be artificially dampening core inflation readings. However, a close examination of recent inflation data shows that the weakness in housing costs is representative of a broad...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Apr 2010

    Monetary Policy In A Low Inflation Economy With Learning

    In theory, monetary policies that target the price level, as opposed to the inflation rate, should be highly effective at stabilizing the economy and avoiding deflation in the presence of the zero lower bound on nominal interest rates. With such a policy, if the short-term interest rate is constrained at...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Feb 2010

    Bond Currency Denomination And The Yen Carry Trade

    The authors examine the determinants of issuance of yen-denominated international bonds over the period from 1990 through 2010. This period was marked by low Japanese interest rates that led some investors to pursue "Carry trades," which consisted of funding investments in higher interest rate currencies with low interest rate, yen-denominated...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Feb 2010

    Mortgage Choice And The Pricing Of Fixed-Rate And Adjustable-Rate Mortgages

    In the United States throughout 2009, the share of adjustable-rate mortgages among total mortgage originations was very low, apparently reflecting the attractive pricing of fixed-rate mortgages relative to ARMs. Government policy could have changed the relative attractiveness of the fixed-rate mortgages and ARMs, thereby shifting the market share of these...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Feb 2010

    Survey Measures Of Expected Inflation And The Inflation Process

    This paper uses data from surveys of expected inflation to learn how expectations processes have changed following recent changes in the behavior of inflation. Households do not appear to have recognized the change in the process, and are placing substantially more weight than appears warranted on recent inflation data when...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Jan 2010

    The Small Business Perspective On Health-Care Reform

    California has 6.5 million uninsured adults, 55 percent of whom work for companies that do not provide health insurance. This percentage accounts for 3.5 million individuals. According to a recent study conducted by the California Healthcare Foundation, roughly 30 percent of the more than 700,000 employers in California do not...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Jan 2010

    Building Healthy Communities Through Equitable Food Access

    In America today, millions of people leave their homes in a protracted and often futile search for healthy food for their families. Many walk out their front doors and see nothing but fast-food outlets and convenience stores selling high-fat, high-sugar processed foods; others see no food vendors of any kind....

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Jan 2010

    Inflation: Mind The Gap

    Monetary policymakers have long debated the usefulness of the Phillips curve, which relates inflation to measures of economic slack. Since the recession started in late 2007, evidence suggests that, consistent with the Phillips curve, a high level of unemployment has contributed to a decline in inflation. Since the fourth quarter...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Jan 2010

    Small Business Finance And Personal Assets

    Small business owners have historically relied on personal assets as an important source of support for their enterprises - from the aspiring restaurant owner relying on personal savings to the toy distributor using a line of credit secured by her home. However, the recent bursting of the credit bubble has...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Jan 2010

    Macro-Finance Models Of Interest Rates And The Economy

    During the past decade, much new research has combined elements of finance, monetary economics, and macroeconomics in order to study the relationship between the term structure of interest rates and the economy. In this paper, the author describes three different strands of such interdisciplinary macro-finance term structure research. The first...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Dec 2009

    Strengthening The Low Income Housing Tax Credit Investment Market

    The Low Income Housing Tax Credit (LIHTC) has been the federal government's most successful program for producing quality rental housing for low-income families and individuals. It has created jobs, revitalized low-income communities, and expanded low-income families' and individuals' access to geographic areas that offer relatively good employment and educational opportunities....

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Dec 2009

    Strength In Adversity: Community Capital Faces Up to the Economic Crisis

    This paper reviews the impact of the economic crisis on the community development industry. Specifically, it asks, how are Community Development Financial Institutions (CDFIs) faring? What trends are emerging? What steps are CDFIs taking to respond to the crisis? In addition, the paper offers "Best practices" to help all CDFIs...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Nov 2009

    Linkages Between Monetary And Regulatory Policy: Lessons From The Crisis

    The crisis of the past two years has underscored the connections between monetary policy, which seeks to foster maximum employment and price stability, and regulatory policy, which works to protect the financial system. The two domains can't be regarded as separate. Researchers are currently examining ways in which monetary policy...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Nov 2009

    Inflation Expectations And The Risk Of Deflation

    Inflation as measured by the consumer price index (CPI) has declined rapidly and even turned negative since the peak of oil and other commodity prices in mid-2008. In light of current high unemployment and prospects for a slow recovery, the question of whether deflation will continue is of critical importance...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Nov 2009

    Mortgage Default And Mortgage Valuation

    The authors develop an equilibrium valuation model that incorporates optimal default to show how mortgage yields and lender recovery rates on defaulted mortgages depend on initial Loan-To-Value (LTV) ratios. The analysis treats both the frictionless case and the case in which borrowers and lenders incur deadweight costs upon default. The...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Oct 2009

    Recent Developments In Mortgage Finance

    As the U.S. housing market has moved from boom in the middle of the decade to bust over the past two years, the sources of mortgage funding have changed dramatically. The government-sponsored enterprises - Fannie Mae, Freddie Mac, and Ginnie Mae - now own or guarantee an overwhelming share of...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Oct 2009

    The Role Of Capital Service-Life In A Model With Heterogenous Labor And Vintage Capital

    The authors examine how the economy responds to both disembodied and embodied technology shocks in a model with vintage capital. They focus on what happens when there is a change in the number of vintages of capital that are in use at any one time and on what happens when...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Oct 2009

    Disagreement About The Inflation Outlook

    Disagreement among economic forecasters about the future path of inflation has risen substantially since the start of the recession. The nature of this disagreement varies with the forecast time horizon, with some forecasters expecting much lower short-run inflation and others anticipating much higher long-run inflation. This variation may complicate the...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Aug 2009

    Exploring The Continuum Of Social And Financial Returns: When Does A Nonprofit Become A Social Enterprise?

    The rate of innovation in the nonprofit sector appears to have accelerated in recent years. Although the new efforts compose a relatively small portion of the sector, they are occurring with greater frequency and have the potential to realign the sector. The nonprofit social enterprise model has been around, amazingly,...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Aug 2009

    Local Stock Exchanges And National Stimulus

    Since the global financial system unraveled in 2008, U.S. policymakers have struggled heroically to improve the performance and oversight of global banks and investment firms. But these actions have been largely unresponsive to the growing number of Americans who would like to remove their hard-earned retirement savings from these high...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Jul 2009

    Macroeconomic Models For Monetary Policy: Conference Summary

    Papers presented at the conference on "Macroeconomic Models for Monetary Policy," held March 6, 2009, at the Federal Reserve Bank of San Francisco, addressed such issues as how to model wage and price behavior and how to measure economic output. The answers to these and other questions examined at the...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Jun 2009

    Employer Health Benefits And Insurance Expansions: Hawaii's Experience

    As policies are proposed to expand health insurance coverage in the United States, it is useful to focus on the experience of Hawaii, where employers are required to offer such insurance to their full-time employees. The authors' findings suggest that Hawaii's law has substantially increased health insurance coverage in the...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Jun 2009

    Fighting Downturns With Fiscal Policy

    Should fiscal policy be used to fight recessions? Most economists would answer that, for normal economic ups and downs, business cycle stabilization should be left to monetary policy and that fiscal policy should focus on long-term goals. The main argument is that monetary policy can act quickly when output falls...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Aug 2009

    Exploring The Continuum Of Social And Financial Returns: When Does A Nonprofit Become A Social Enterprise?

    The rate of innovation in the nonprofit sector appears to have accelerated in recent years. Although the new efforts compose a relatively small portion of the sector, they are occurring with greater frequency and have the potential to realign the sector. The nonprofit social enterprise model has been around, amazingly,...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Dec 2010

    Building Scale In Community Impact Investing Through Nonfinancial Performance Measurement

    The measurement of nonfinancial performance is becoming increasingly important in the community impact investing industry, where individuals and institutions actively deploy capital in low-income domestic markets for both financial and social returns. Quality data ensure that the creation of jobs, construction of community facilities, financing of affordable housing, and other...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Feb 2010

    Mortgage Choice And The Pricing Of Fixed-Rate And Adjustable-Rate Mortgages

    In the United States throughout 2009, the share of adjustable-rate mortgages among total mortgage originations was very low, apparently reflecting the attractive pricing of fixed-rate mortgages relative to ARMs. Government policy could have changed the relative attractiveness of the fixed-rate mortgages and ARMs, thereby shifting the market share of these...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Nov 2009

    Inflation Expectations And The Risk Of Deflation

    Inflation as measured by the consumer price index (CPI) has declined rapidly and even turned negative since the peak of oil and other commodity prices in mid-2008. In light of current high unemployment and prospects for a slow recovery, the question of whether deflation will continue is of critical importance...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Jan 2009

    Inflation Expectations And Risk Premiums In An Arbitrage-Free Model Of Nominal And Real Bond Yields

    Differences between yields on comparable-maturity U.S. Treasury nominal and real debt, the so-called Breakeven Inflation (BEI) rates, are widely used indicators of inflation expectations. However, better measures of inflation expectations could be obtained by subtracting inflation risk premiums from the BEI rates. The authors provide such decompositions using an estimated...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Feb 2009

    Foreign Entry Into Underwriting Services: Evidence From Japan's "Big Bang" Deregulation

    The authors examine the impact of foreign underwriting activity using issue-level data in the Japanese "Samurai" and euro-yen bond markets. Firms choosing Japanese underwriters tend to be Japanese, riskier, and smaller. They find that Japanese underwriting fees, while higher overall on average, are actually lower after conditioning for issuer characteristics....

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Jun 2009

    Do Central Bank Liquidity Facilities Affect Interbank Lending Rates?

    In response to the global financial crisis that started in August 2007, central banks provided extraordinary amounts of liquidity to the financial system. To investigate the effect of central bank liquidity facilities on term interbank lending rates, the authors estimate a six-factor arbitrage-free model of U.S. Treasury yields, financial corporate...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Feb 2010

    Survey Measures Of Expected Inflation And The Inflation Process

    This paper uses data from surveys of expected inflation to learn how expectations processes have changed following recent changes in the behavior of inflation. Households do not appear to have recognized the change in the process, and are placing substantially more weight than appears warranted on recent inflation data when...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // May 2003

    How Might Financial Market Information Be Used for Supervisory Purpose

    This paper addresses three public policy questions related to how supervisors might use this financial market information. To address the first question, the paper summarizes the academic literature on the topic and presents empirical results using BHC stock returns and bond spreads. It addresses the second question by using forecasts...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Jan 2010

    Small Business Finance And Personal Assets

    Small business owners have historically relied on personal assets as an important source of support for their enterprises - from the aspiring restaurant owner relying on personal savings to the toy distributor using a line of credit secured by her home. However, the recent bursting of the credit bubble has...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Mar 2009

    How Will A Credit Crunch Affect Small Business Finance?

    Small businesses may be particularly vulnerable to a credit crunch. Small companies do not have access to the capital markets. Thus, their sources of external financing are much more limited than large corporations. If these sources shrink, small businesses could be adversely affected. This Economic Letter explores how the credit...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Jan 2010

    The Small Business Perspective On Health-Care Reform

    California has 6.5 million uninsured adults, 55 percent of whom work for companies that do not provide health insurance. This percentage accounts for 3.5 million individuals. According to a recent study conducted by the California Healthcare Foundation, roughly 30 percent of the more than 700,000 employers in California do not...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Dec 2009

    Strengthening The Low Income Housing Tax Credit Investment Market

    The Low Income Housing Tax Credit (LIHTC) has been the federal government's most successful program for producing quality rental housing for low-income families and individuals. It has created jobs, revitalized low-income communities, and expanded low-income families' and individuals' access to geographic areas that offer relatively good employment and educational opportunities....

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // May 2010

    Rural Banking In China

    China's rural banking market is serviced mainly by four types of financial institutions: a large commercial bank; a policy bank; a postal savings bank; and small and medium sized rural financial institutions (see chart below). Of the major players focused on the rural banking market, small and medium-sized rural financial...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Dec 2009

    Strength In Adversity: Community Capital Faces Up to the Economic Crisis

    This paper reviews the impact of the economic crisis on the community development industry. Specifically, it asks, how are Community Development Financial Institutions (CDFIs) faring? What trends are emerging? What steps are CDFIs taking to respond to the crisis? In addition, the paper offers "Best practices" to help all CDFIs...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Apr 2009

    It's The Rating, Stupid: A Banker's Perspective On The CRA

    The Community Reinvestment Act (CRA) of 1977 has survived more than three decades of restructuring of the banking industry, of sporadic changes in the regulations, and of an evolution of best practices in community development. The CRA has seen many successes but is now in need of a major overhaul...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Jan 2009

    The Role Of Incubators In Cultivating Small Business

    While many people associate the term incubator with the dot-com era, business incubation programs actually trace their beginnings back to 1959, when the first program opened in Batavia, New York. Since then, the industry has grown dramatically, both in terms of the number of programs in operation and the depth...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Aug 2009

    Local Stock Exchanges And National Stimulus

    Since the global financial system unraveled in 2008, U.S. policymakers have struggled heroically to improve the performance and oversight of global banks and investment firms. But these actions have been largely unresponsive to the growing number of Americans who would like to remove their hard-earned retirement savings from these high...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Mar 2009

    Collaborators Or Competitors? Exploring The Relationships Between Community Development

    This study examines the nature of the interaction of banks and community development financial institutions (CDFIs) in small business lending. The authors examine the experience of six different CDFIs that vary by size, corporate structure, and market. They explore how they both collaborate and compete with regulated lenders, and how...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Jan 2010

    Building Healthy Communities Through Equitable Food Access

    In America today, millions of people leave their homes in a protracted and often futile search for healthy food for their families. Many walk out their front doors and see nothing but fast-food outlets and convenience stores selling high-fat, high-sugar processed foods; others see no food vendors of any kind....

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Jan 2010

    Macro-Finance Models Of Interest Rates And The Economy

    During the past decade, much new research has combined elements of finance, monetary economics, and macroeconomics in order to study the relationship between the term structure of interest rates and the economy. In this paper, the author describes three different strands of such interdisciplinary macro-finance term structure research. The first...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // May 2010

    Financial Crisis And Bank Lending

    The recent financial crisis has severely weakened the U.S. banking industry. The number of bank failures has skyrocketed, and it continues to climb. Bank stocks plummeted. In response to both the great economic recession and the dire conditions of the banking industry, banks tightened their lending terms and standards to...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // May 2011

    Fiscal Spending Jobs Multipliers: Evidence From The 2009 American Recovery And Reinvestment Act

    This paper estimates the "Jobs multiplier" of fiscal spending - by sector, by type of spending, and over time - using the state-level allocations of federal stimulus funds from the American Recovery and Reinvestment Act (ARRA) of 2009. Because the level and timing of stimulus funds that a state receives...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Jan 2011

    If You Try, You'll Get By: Chinese Private Firms? Efficiency Gains From Overcoming Financial Constraints

    The importance of finances in economic development has long been advocated and empirically tested in the economic literature. As early as 1911, Schumpeter has linked the importance of financial services to firms' capacity in engaging technological innovation and thus a country's ability in economic development. Based on country-level analyses, King...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Dec 2010

    Supplemental Materials: Do Credit Constraints Amplify Macroeconomic Fluctuations?

    The economy is populated by two types of agents - households and entrepreneurs - with a continuum and unit measure of each type. There are four types of commodities: labor, goods, land, and loanable bonds. Goods production requires labor, capital, and land as inputs. The output can be used for...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Apr 2010

    Simple And Robust Rules For Monetary Policy

    This paper focuses on simple normative rules for monetary policy which central banks can use to guide their interest rate decisions. Such rules were first derived from research on empirical monetary models with rational expectations and sticky prices built in the 1970s and 1980s. During the past two decades substantial...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Apr 2009

    Monetary Policy In A Small Open Economy With A Preference For Robustness

    The authors use robust control techniques to study the effects of model uncertainty on monetary policy in a small-open-economy model estimated on Australian data. Compared to the closed economy, the presence of open-economy transmission channels and shocks not only produces new trade-offs for monetary policy, but also introduces additional sources...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Jul 2009

    Macroeconomic Models For Monetary Policy: Conference Summary

    Papers presented at the conference on "Macroeconomic Models for Monetary Policy," held March 6, 2009, at the Federal Reserve Bank of San Francisco, addressed such issues as how to model wage and price behavior and how to measure economic output. The answers to these and other questions examined at the...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Jun 2011

    Economics Instruction And The Brave New World Of Monetary Policy

    Economics education faces a challenge in keeping up with the changes that have swept through monetary policy in recent decades. Many central banking innovations, such as interest on reserves and large-scale asset purchases, aren't adequately treated in standard textbooks. The following is adapted from a presentation made by the president...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Nov 2009

    Linkages Between Monetary And Regulatory Policy: Lessons From The Crisis

    The crisis of the past two years has underscored the connections between monetary policy, which seeks to foster maximum employment and price stability, and regulatory policy, which works to protect the financial system. The two domains can't be regarded as separate. Researchers are currently examining ways in which monetary policy...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Jun 2009

    Fighting Downturns With Fiscal Policy

    Should fiscal policy be used to fight recessions? Most economists would answer that, for normal economic ups and downs, business cycle stabilization should be left to monetary policy and that fiscal policy should focus on long-term goals. The main argument is that monetary policy can act quickly when output falls...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Jan 2011

    Consumers And The Economy, Part II: Household Debt And The Weak U.S. Recovery

    The U.S. economic recovery has been weak, especially in employment growth. A microeconomic analysis of U.S. counties shows that this weakness is closely related to elevated levels of household debt accumulated during the housing boom. Counties where household debt grew moderately from 2002 to 2006 have seen a moderation of...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Oct 2009

    Disagreement About The Inflation Outlook

    Disagreement among economic forecasters about the future path of inflation has risen substantially since the start of the recession. The nature of this disagreement varies with the forecast time horizon, with some forecasters expecting much lower short-run inflation and others anticipating much higher long-run inflation. This variation may complicate the...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Jan 2010

    Inflation: Mind The Gap

    Monetary policymakers have long debated the usefulness of the Phillips curve, which relates inflation to measures of economic slack. Since the recession started in late 2007, evidence suggests that, consistent with the Phillips curve, a high level of unemployment has contributed to a decline in inflation. Since the fourth quarter...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Apr 2010

    The Housing Drag On Core Inflation

    Some analysts have raised the question of whether the unprecedented declines in house values, which have been the hallmark of the recent recession, might be artificially dampening core inflation readings. However, a close examination of recent inflation data shows that the weakness in housing costs is representative of a broad...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Sep 2010

    Global Recovery: Asia And The New Financial Landscape

    On June 7 and 8, 2010, the Federal Reserve Bank of San Francisco's biennial Conference on Asian Banking and Finance considered the "Global Recovery: Asia and the New Financial Landscape." The Conference is the fourth in a series begun in 2007 to examine the role of Asia in global finance....

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Apr 2010

    Monetary Policy In A Low Inflation Economy With Learning

    In theory, monetary policies that target the price level, as opposed to the inflation rate, should be highly effective at stabilizing the economy and avoiding deflation in the presence of the zero lower bound on nominal interest rates. With such a policy, if the short-term interest rate is constrained at...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Dec 2010

    Social Metrics In Investing: The Future Depends On Financial Outperformance And Leadership

    In order to truly unlock the potential of the impact investing industry, social/environmental metrics must be directly connected to financial outperformance. When above-market rate - or premium - financial returns are present, large fiduciaries such as public pension plans (who globally hold a total of $23 trillion in assets), are...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Jun 2009

    Employer Health Benefits And Insurance Expansions: Hawaii's Experience

    As policies are proposed to expand health insurance coverage in the United States, it is useful to focus on the experience of Hawaii, where employers are required to offer such insurance to their full-time employees. The authors' findings suggest that Hawaii's law has substantially increased health insurance coverage in the...

    Provided By Federal Reserve Bank of San Francisco

  • White Papers // Feb 2010

    Bond Currency Denomination And The Yen Carry Trade

    The authors examine the determinants of issuance of yen-denominated international bonds over the period from 1990 through 2010. This period was marked by low Japanese interest rates that led some investors to pursue "Carry trades," which consisted of funding investments in higher interest rate currencies with low interest rate, yen-denominated...

    Provided By Federal Reserve Bank of San Francisco