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The long-run determinants of U.S. external imbalances

Ferrero, Andrea - Federal Reserve Bank of New York - 2007

quantitatively three potential determinants of the U.S. external imbalances in the last three decades: productivity growth …, demographic factors, and fiscal policy. The results suggest that (1) productivity growth differentials are the main driving force …

Persistent link: https://www.econbiz.de/10005726628

Benefits and spillovers of greater competition in Europe: a macroeconomic assessment

Bayoumi, Tamim; Laxton, Douglas; Pesenti, Paolo - Federal Reserve Bank of New York - 2004

We estimate the macroeconomic benefits and international spillovers of an increase in competition using a general-equilibrium simulation model with nominal rigidities and monopolistic competition in product and labor markets. We draw three conclusions after calibrating the model to the euro area...

Persistent link: https://www.econbiz.de/10005526265

Learning the fiscal theory of the price level: some consequences of debt management policy

Eusepi, Stefano; Preston, Bruce - Federal Reserve Bank of New York - 2011

This paper examines how the scale and composition of public debt can affect economies that implement a combination of “passive” monetary policy and “active” fiscal policy. This policy configuration is argued to be of both historical and contemporary interest in the cases of the U.S. and...

Persistent link: https://www.econbiz.de/10009320709

What fiscal policy is effective at zero interest rates?

Eggertsson, Gauti B. - Federal Reserve Bank of New York - 2009

Tax cuts can deepen a recession if the short-term nominal interest rate is zero, according to a standard New Keynesian business cycle model. An example of a contractionary tax cut is a reduction in taxes on wages. This tax cut deepens a recession because it increases deflationary pressures....

Persistent link: https://www.econbiz.de/10008636196

Tax buyouts

Negro, Marco Del; Perri, Fabrizio; Schivardi, Fabiano - Federal Reserve Bank of New York - 2010

The paper studies a fiscal policy instrument that can reduce fiscal distortions, without affecting revenues, in a politically viable way. The instrument is a private contract (tax buyout), offered by the government to each individual citizen, whereby the citizen can choose to pay a fixed price...

Persistent link: https://www.econbiz.de/10008461964

Stabilizing expectations under monetary and fiscal policy coordination

Eusepi, Stefano; Preston, Bruce - Federal Reserve Bank of New York - 2008

This paper analyzes how the formation of expectations constrains monetary and fiscal policy design. Economic agents have imperfect knowledge about the economic environment and the policy regime in place. Households and firms learn about the policy regime using historical data. Regime uncertainty...

Persistent link: https://www.econbiz.de/10004994125

Still not out of the woods? New Jersey schools during the recession and beyond

Chakrabarti, Rajashri; Livingston, Max - Federal Reserve Bank of New York - 2013

Schools are essential in forming human capital and in improving the long-term health of the economy. They are also heavily reliant on state and local funds, which were severely depleted during the Great Recession. To alleviate some of the strain on local budgets, the federal government passed...

Persistent link: https://www.econbiz.de/10010699374

Cúrdia, Vasco; Reis, Ricardo - Federal Reserve Bank of New York - 2010

The dynamic stochastic general equilibrium (DSGE) models used to study business cycles typically assume that exogenous disturbances are independent first-order autoregressions. This paper relaxes this tight and arbitrary restriction by allowing for disturbances that have a rich contemporaneous...

Persistent link: https://www.econbiz.de/10008553244

How should suburbs help their central cities?

Haughwout, Andrew F.; Inman, Robert P. - Federal Reserve Bank of New York - 2004

In this paper, we study the question whether suburbs should help finance the core public services of their central cities. We review three arguments that have been offered in favor of suburbs' fiscal assistance to their central cities. First, the central city provides public services that...

Persistent link: https://www.econbiz.de/10005420503

The advantage of flexible targeting rules

Ferrero, Andrea - Federal Reserve Bank of New York - 2008

This paper investigates the consequences of debt stabilization for inflation targeting. If the monetary authority … perfectly stabilizes inflation while the fiscal authority holds constant the real value of debt at maturity, the equilibrium … inflation targeting appears to be more robust than flexible debt targeting to alternative parameter configurations and steady …

Persistent link: https://www.econbiz.de/10005420654