Institution
Federal Reserve Bank of St. Louis
Other•St Louis, Missouri, United States•
About: Federal Reserve Bank of St. Louis is a other organization based out in St Louis, Missouri, United States. It is known for research contribution in the topics: Monetary policy & Inflation. The organization has 203 authors who have published 1650 publications receiving 46084 citations.
Topics: Monetary policy, Inflation, Interest rate, Business cycle, Debt
Papers published on a yearly basis
Papers
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TL;DR: In this paper, the authors argue that international trade in capital goods has quantitatively important effects on economic development through two channels: (i) capital formation and (ii) aggregate TFP.
Abstract: Almost 80 percent of capital goods production in the world is concentrated in 10 countries. Poor countries import most of their capital goods. We argue that international trade in capital goods has quantitatively important effects on economic development through two channels: (i) capital formation and (ii) aggregate TFP. We embed a multi country, multi sector Ricardian model of trade into a neoclassical growth model. Barriers to trade result in a misallocation of factors both within and across countries. We calibrate the model to bilateral trade flows, prices, and income per worker. Our model matches several trade and development facts within a unified framework. It is consistent with the world distribution of capital goods production, cross-country differences in investment rate and price of final goods, and cross-country equalization of price of capital goods and marginal product of capital. The cross-country income differences decline by more than 50 percent when distortions to trade are eliminated, with 80 percent of the change in each country’s income attributable to change in capital. Autarky in capital goods results in an income loss of 17 percent for poor countries, with all of the loss stemming from decreased capital.
28 citations
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TL;DR: In this paper, the authors provide international evidence on the issue of whether the optimizing IS equation is more stable than a backward-looking alternative, based on estimates of IS equations on quarterly data for the UK and Australia, both for the full sample of the last 40 years and for the period following major monetary policy shifts in 1979−80.
Abstract: In this paper we provide international evidence on the issue of whether the optimizing IS equation is more stable than a backward-looking alternative. The international evidence consist of estimates of IS equations on quarterly data for the UK and Australia, both for the full sample of the last 40 years and for the period following major monetary policy shifts in 1979−80. Our results suggest that the parameters in the optimizing IS equations are more empirically stable than those of the backward-looking alternative. The use of dynamic general equilibrium modelling in empirical work does deliver material benefits, in the form of equations that are more suitable for monetary policy analysis.
28 citations
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TL;DR: This article used the quasi-random flooding generated by Hurricane Harvey, which hit Houston in August 2017, to understand the implications of flood losses for households with differing access to insurance and credit.
Abstract: Outside of flood hazard zones, households must decide whether to insure or rely on disaster assistance to manage flood risk. We use the quasi-random flooding generated by Hurricane Harvey, which hit Houston in August 2017, to understand the implications of flood losses for households with differing access to insurance and credit. Outside the floodplain, credit-constrained homeowners experience a 20% increase in bankruptcies and a 13% increase in the share of debt in severe delinquency in flooded blocks relative to non-flooded areas. Treatment effects are universally insignificant inside the floodplain, implying that flood insurance mitigates the financial impact of flooding across the credit distribution. Disaster assistance, on the other hand, does not appear to counteract the role of initial inequalities on post-disaster credit outcomes. We find SBA disaster loans and, more surprisingly, FEMA grants to both be regressive in allocation. Our results highlight that averages mask important heterogeneity after disasters, which challenges existing narratives of how effectively Federal disaster programs mitigate the financial burden of natural disasters.
28 citations
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TL;DR: In this article, the authors identify two government spending shocks: military spending shocks and federal spending shocks, and analyze the effect of these shocks on state-level personal income and employment.
Abstract: We simultaneously identify two government spending shocks: military spending shocks as defined by Ramey (2008) and federal spending shocks as defined by Perotti (2008). We analyze the effect of these shocks on state-level personal income and employment. We find regional patterns in the manner in which both shocks affect state-level variables. Moreover, we find differences in the propagation mechanisms for military versus nonmilitary spending shocks. The former benefits economies with larger manufacturing and retail sectors and states that receive military contracts. While non-military shocks also benefit states with the proper industrial mix, they appear to stimulate economic activity in lower-income states.
28 citations
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TL;DR: In this paper, the authors propose an alternative model in which the blocks are chosen endogenously in a Bayesian framework using a hierarchical prior, which allows them to incorporate series-level covariates that may influence and explain how the series are grouped.
Abstract: Summary
Factor models have become useful tools for studying international business cycles. Block factor models can be especially useful as the zero restrictions on the loadings of some factors may provide some economic interpretation of the factors. These models, however, require the econometrician to predefine the blocks, leading to potential misspecification. In Monte Carlo experiments, we show that even a small misspecification can lead to substantial declines in fit. We propose an alternative model in which the blocks are chosen endogenously. The model is estimated in a Bayesian framework using a hierarchical prior, which allows us to incorporate series-level covariates that may influence and explain how the series are grouped. Using international business cycle data, we find our country clusters differ in important ways from those identified by geography alone. In particular, we find that similarities in institutions (e.g., legal systems, language diversity) may be just as important as physical proximity for analyzing business cycle comovements.
27 citations
Authors
Showing all 214 results
Name | H-index | Papers | Citations |
---|---|---|---|
William Easterly | 93 | 253 | 49657 |
David K. Levine | 66 | 358 | 22455 |
Lucio Sarno | 65 | 218 | 17418 |
Paul W. Wilson | 53 | 147 | 18562 |
Christopher J. Neely | 47 | 201 | 8438 |
Edward Nelson | 46 | 143 | 7819 |
David C. Wheelock | 40 | 173 | 6125 |
Michele Boldrin | 40 | 154 | 8365 |
Massimo Guidolin | 36 | 230 | 5640 |
Daniel L. Thornton | 36 | 230 | 5064 |
Jeremy M. Piger | 34 | 98 | 5997 |
Howard J. Wall | 34 | 136 | 4488 |
Michael T. Owyang | 34 | 204 | 3890 |
Christopher Otrok | 34 | 98 | 7601 |
Ping Wang | 33 | 241 | 4263 |