In 1952, the average quarterly volatility of U.S. state employment growth stood at 1.5 percent. By 1995, employment growth volatility came in at just under 0.5 percent. While all states shared in the decline, some states declined much more dramatically than others. We analyze aspects of this...

Many recent studies have identified a decline in the volatility of U.S. real output over the last half century. This study examines a less discussed and analyzed trend, but one as significant as the drop in output volatility, namely a substantial decline in employment volatility during the...

A simple monetary model with increasing consumption variety is used to examine issues surrounding optimal monetary policy and its implementation. When consumption variety is increasing, there is a wedge driven between inflation measured in terms of goods prices and inflation measured in terms of...

Cyclical dynamics at the regional level are investigated using newly developed time-series techniques that allow a decomposition of aggregate data into common trends and common cycles. We apply the common-trend/common-cycle representation to per capita personal income for the eight BEA regions...

The authors investigate an international monetary business-cycle model in which agents face monetary policy processes that incorporate regime shifts. In any given period agents cannot directly observe the policy regime, but instead form beliefs that are updated via Bayesian learning. As a...

The author examines the data on just how much risk-sharing currently takes place in both developed and developing countries. He also considers the question of whether significant unexploited gains from risk-sharing exist across borders.

When setting monetary policy, should policymakers target variables such as commodity prices or interest rate spreads, which are sensitive to the market's expectations of inflation? Or are variables such as money growth, which are tied to the underlying causes of inflation and economic growth,...

An equilibrium model is used to assess the quantitative importance of monetary policy for the post-1984 decline in U.S. inflation and output volatility. The principal finding is that monetary policy played a substantial role in reducing inflation volatility, but a small role in reducing real...

This paper examines the cyclical dynamics of per capita personal income for the major U.S. regions during the 1953:3-95:2 period. The analysis reveals considerable differences in the volatility of regional cycles. Controlling for differences in volatility, the authors find a great deal of...

This study documents a substantial decline in employment volatility at business-cycle frequencies over the postwar period using state-industry level data. The distribution of total employment volatilities at the state level has become less disperse over time, and mean volatility has fallen....