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Borrowing restrictions and wealth constraints: implications for aggregate consumption

Walsh, Carl E. - Federal Reserve Bank of San Francisco - 1986

Recent empirical studies have found that consumption is more sensitive to current income than simple versions of the … life-cycle, permanent income hypothesis would predict. The present paper studies a model in which the fraction of consumers … exhibiting excess sensitivity is endogenously determined. The presence of income uncertainty and restrictions on borrowing are …

Persistent link: https://www.econbiz.de/10005078270

Dollar illiquidity and central bank swap arrangements during the global financial crisis

Rose, Andrew K.; Spiegel, Mark M. - Federal Reserve Bank of San Francisco - 2011

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...

Persistent link: https://www.econbiz.de/10009206325

Bank intermediation and persistent liquidity effects in the presence of a frictionless bond market

Einarsson, Tor; Marquis, Milton H. - Federal Reserve Bank of San Francisco - 2000

An “expansionary” monetary policy that increases the growth rate of bank reserves is generally believed by policy makers to induce a “liquidity effect”, or a persistent decline in short-term nominal interest rates, that stimulates real activity. Christiano, et al. (1991,1995,1997) have...

Persistent link: https://www.econbiz.de/10011026931

Heeding Daedalus: Optimal inflation and the zero lower bound

Williams, John C. - Federal Reserve Bank of San Francisco - 2009

This paper reexamines the implications of the zero lower bound on interest rates for monetary policy and the optimal choice of steady-state inflation in light of the experience of the recent global recession. There are two main findings. First, the zero lower bound did not materially contribute...

Persistent link: https://www.econbiz.de/10008603769

Bank intermediation and persistent liquidity effects in the presence of a frictionless bond market

Einarsson, Tor; Marquis, Milton H. - Federal Reserve Bank of San Francisco - 2000

Persistent link: https://www.econbiz.de/10005401595

Off-balance-sheet liquidity and monetary control

Glick, Reuven; Plaut, Steven E. - Federal Reserve Bank of San Francisco - 1987

Persistent link: https://www.econbiz.de/10005078331

Temptation and self-control: some evidence and applications

Huang, Kevin X.D.; Liu, Zheng; Zhu, John Q. - Federal Reserve Bank of San Francisco - 2013

This paper studies the empirical relevance of temptation and self-control using household-level data from the Consumer Expenditure Survey. We construct an infinite-horizon consumption-savings model that allows, but does not require, temptation and self-control in preferences. In the presence of...

Persistent link: https://www.econbiz.de/10010692378

Doubts and variability: a robust perspective on exotic consumption series

Bidder, Rhys; Smith, Matthew E. - Federal Reserve Bank of San Francisco - 2013

In order for consumption based asset pricing models to reconcile data on returns with that on consumption, researchers have resorted to augmenting the consumption series in exotic ways. When an agent’s consumption series is subject to changes in volatility, we show that concerns for model...

Persistent link: https://www.econbiz.de/10010699352

A robust Hansen-Sargent prediction formula

Kasa, Kenneth - Federal Reserve Bank of San Francisco - 2000

This paper derives a formula for the optimal forecast of a discounted sum of future values of a random variable. This problem reflects a preference for robustness in the presence of (unstructured) model uncertainty. The paper shows that revisions of a robust forecast are more sensitive to new...

Persistent link: https://www.econbiz.de/10010702142

Government employment and the dynamic effects of fiscal policy shocks

Cavallo, Michele P. - Federal Reserve Bank of San Francisco - 2005

Since World War II, about 75 percent of government consumption in the U.S. economy has been spent on labor services. I distinguish the goods and the employment compensation components of government consumption in assessing the effects of fiscal shocks on main macroeconomic variables. Identifying...

Persistent link: https://www.econbiz.de/10010702149