Economic Research

Why Are Interest Rates So Low?
The low level of interest rates since 2008 is largely attributable to a reduction in the natural rate of interest, which reflects cautious behavior on the part of households and firms. Monetary policy has largely accommodated the decline in the natural rate of interest in order to mitigate the adverse effects of the crisis.
By Marco Del Negro, Marc Giannoni, Matthew Cocci, Sara Shahanaghi, and Micah Smith
The FRBNY DSGE Model Forecast--April 2015
First in a two-part series. The bloggers provide an update of the economic forecasts implied by the New York Fed’s dynamic stochastic general equilibrium (DSGE) model, which continues to predict a gradual recovery in economic activity with a progressive but slow return of inflation toward the FOMC’s long-run target of 2 percent.
By Marco Del Negro, Marc Giannoni, Matthew Cocci, Sara Shahanaghi, and Micah Smith
Mortgage Borrowing among Most Creditworthy Abates
The New York Fed’s Quarterly Report on Household Debt and Credit for the first quarter of 2015 reports slow growth in debt balances. But who is borrowing, and who is paying down their balances? The bloggers identify the changes in balances by credit score, providing an in-depth look at the change in mortgage balances.
By Andrew Haughwout, Donghoon Lee, Joelle Scally, and Wilbert van der Klaauw
Financial Innovation: The Origins of the Tri-Party Repo Market
First in a two-part series. While tri-party repo ultimately evolved in ways that created and amplified systemic risk, it was originally created as a clever way to reduce the costs and risks that individual firms faced when settling bilateral repos.
By Antoine Martin and Susan McLaughlin
Evolution of the Tri-Party Repo Arrangement
First in a two-part series. While tri-party repo ultimately evolved in ways that created and amplified systemic risk, it was originally created as a clever way to reduce the costs and risks that individual firms faced when settling bilateral repos.
By Antoine Martin and Susan McLaughlin
Supplemental Survey Report
Manufacturers and service sector firms in the New York-Northern New Jersey region respond to survey questions focused on past and expected changes in prices.
Business Leaders Survey
Business Leaders Survey
The May 2015 survey indicates that activity in the New York region's service sector expanded moderately.
Empire State Manufacturing Survey
Empire State Manufacturing Survey
Latest survey for May 2015 finds business conditions have improved slightly for New York manufacturers.
Greenboard with math squiggles for DSGE model artwork
The FRBNY DSGE Model
In recent work, economists described the New York Fed’s dynamic stochastic equilibrium model, assessed its forecasting accuracy, and shared source code used for model estimation.
Research Topics in Focus: College grads
Is College Worth It?
Students in recent years have been paying more to attend college and earning less upon graduation—trends that have raised questions about whether a college education remains a good investment. But research from economists Jaison Abel and Richard Deitz finds that the benefits of college still tend to outweigh the costs.
Recent Articles
Supervising Large, Complex Financial Companies: What Do Supervisors Do?
This paper describes the Federal Reserve’s supervisory approach to large, complex financial companies and outlines how prudential supervisory activities are structured, staffed, and implemented on a day-to-day basis at the New York Fed. The goal is to generate insight for those not involved in supervision into what supervisors do and how they do it.
By Thomas Eisenbach, Andrew Haughwout, Beverly Hirtle, Anna Kovner, David Lucca, and Matthew Plosser, Staff Reports 729, May 2015
Small Firms' Formalization: The Stick Treatment
The authors perform an experiment—a stick intervention—which is perhaps the first one in a developing country setting that deals with the most direct and dominant form of firm informality, that is, registration with the tax authority with a direct link to the country's potential revenue base and thus public goods provision.
By Giacomo De Giorgi, Matthew Ploenzke, and Aminur Rahman, Staff Reports 728, May 2015
Asset Price Effects of Peer Benchmarking: Evidence from a Natural Experiment
To isolate the component of demand that arises solely from peer benchmarking, the authors study trading behavior by Colombian pension fund managers in the presence of a peer-based under-performance penalty known as the Minimum Return Guarantee.
By Sushant Acharya and Alvaro Pedraza, Staff Reports 727, May 2015
Intermediaries as Information Aggregators: An Application to U.S. Treasury Auctions
In most theories of financial intermediation, intermediaries diversify risk, transform maturity or liquidity, and screen or monitor borrowers. But in U.S. Treasury auctions, none of these rationales apply. The authors explore a new information aggregation model of intermediation to examine current policy questions, such as the optimal number of intermediaries, the effect of non-intermediated bids, and minimum bidding requirements.
By Nina Boyarchenko, David O. Lucca, and Laura Veldkamp, Staff Reports 726, April 2015
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