We estimate how spending in Texas responded to a 1997 constitutional amendment that relaxed severe restrictions on home equity lending. We use this event as a natural experiment to estimate the importance of credit constraints. If households are credit-constrained, such an increase in credit...

Modern paper currency contributes little to productive investment. This shortcoming is not inherent to paper money. It stems from the fact that such money is monopolistically supplied by public monetary authorities that are poor intermediaries. Commercial banknotes, in contrast, are just as...

This paper examines the role of aggregate productivity and money supply shocks in determining the relationship between inflation and the distribution of relative commodity prices. I estimate a restricted VAR that includes aggregate variables and individual commodity prices, and compute the...

I show how to estimate and identify a large-scale vector autoregression when the variables in a subset of the system are mutually independent after conditioning on a separate set of variables (diagonality), and when the conditioning variables are independent of the former subset (block...

This paper proposes a Bayesian approach to incorporating specification and identification uncertainty into a VAR analysis of the dynamic effects of money supply shocks on the macroeconomy. The approach follows Poirier (1991) in averaging over discrete model specifications in forming posterior...

In this paper, we analyze the effects of money on the market for durable goods. Using quarterly US data, we estimate the dynamic responses of the price and quantity of durable goods and housing to money supply shocks, assuming only that money is neutral in the long-run. We then match these...

I show how to estimate and identify a large-scale vector autoregression when the variables in a subset of the system are mutually independent after conditioning on a separate set of variables (diagonality), and when the conditioning variables are independent of the former subset (block...

This paper examines the role of aggregate productivity and money supply shocks in determining the relationship between inflation and the distribution of relative commodity prices. I estimate a restricted VAR that includes aggregate variables and individual commodity prices, and compute the...

Although its role has been overlooked by monetary historians, a two-cent tax on bank checks effective from June 1932 through December 1934 appears to have been an important contributing factor to that period's severe monetary contraction. According to our estimates, the currency-demand deposit...

Our study examines whether the NFIP induces excessive risk taking in real estate development, and the extent to which this places additional burdens on taxpayers. We use data from Florida over the period 1975 to 2000, during which time communities in each of the state's counties (with the...