Can protests cause political change, or are they merely symptoms of underlying shifts in policy preferences? We address this question by studying the Tea Party movement in the United States, which rose to prominence through coordinated rallies across the country on Tax Day, April 15, 2009. We...

A persistent issue for central banks in emerging market economies (EMEs) has been their difficulties in pursuing counter-cyclical monetary policies such as those adopted in advanced economies (AEs). The flexible inflation targeting pursued by most AE central banks entails tightening monetary...

Have workers stopped moving to the highest-density, highest-productivity places in the country because of a decline in the urban wage premium, or because the rent is too high?

We show that news stories contain information about economic linkages between firms and document that information diffuses slowly across linked stocks. Specifically, we identify linked stocks from co-mentions in news stories and find that linked stocks cross-predict one another's returns in the...

Meyer and Sullivan examine income inequality between 1963 and 2014 using the Current Population Survey and consumption inequality between 1960 and 2014 using the Consumer Expenditure Survey.

A new options-pricing formula applies to far-out-of-the money put options on the stock market when disaster risk dominates, the size distribution of disasters follows a power law, and the economy has a representative agent with Epstein-Zin utility. The elasticity of the put-options price is one...

The efficacy of the Financial Stability Board's proposed requirement for minimum "total loss absorbing capacity" (TLAC) at global systemically important banks (G-SIBs) is assessed using a stylized model of a bank holding company and an equilibrium asset pricing model to value financial claims. I...

Why do individuals join interest groups?

Barro and McCleary look at differential investment in education across types of Protestantism. They find that literacy is enhanced more by Mainline Protestant schools then by Other Protestant schools and that Catholic schools have the weakest relation with literacy, likely because the ouster of...

Fake and substandard medicines are a significant problem in developing nations and a growing problem in developed ones, too. This study finds that corruption is strongly correlated with poor-quality drugs.