Related links: http://www.richmondfed.org/publications/research/region_focus/2010/q2/feature5_weblinks.cfm

There have been a number of high-profile cases of product recalls recently. Those incidents suggest that the marketplace generally works as economists would predict. Firms that produce defective goods usually take a hit to their reputation and their bottom line, though there are exceptions.

Access to credit enables businesses to smooth income streams and take advantage of growth opportunities. Without credit, a business may be forced to cut production or restrain growth. If credit constraints affect businesses across economic sectors, the result could be widespread declines in...

The ratio of household debt to disposable personal income fell rapidly during the recession of 2007-09 as consumers defaulted on loans, paid down debt, and took out fewer loans. According to some economists, this household debt reduction — "deleveraging" — has constrained consumer spending,...