Economic Letter
Brief summaries of SF Fed economic research that explain in reader-friendly terms what our work means for the people we serve.
-
Are State R&D Tax Credits Constitutional? An Economic Perspective
Daniel Wilson
Policymakers at both the state and local level have long used tax incentives, in some form or other, to entice firms to locate or stay in their communities. While some economists have raised serious concerns about whether such incentives lead to socially wasteful “tax competition,” a federal appeals court decision in September 2004 has raised serious doubts about whether some are even constitutional.
-
More Life vs. More Goods: Explaining Rising Health Expenditures
Charles I. Jones
Debates about health care have been a central feature of U.S. public policy discussions for at least the last 20 years. One trigger of these debates is the statistical evidence on the rising cost of health care.
-
Can Monetary Policy Influence Long-term Interest Rates?
Òscar Jordà
There is a well-worn story that illustrates how economists view financial markets (and, perhaps, the rest of the world). An economist and a non-economist are walking down the street. The non-economist spots a $20 bill on the sidewalk and starts to reach for it.
-
The Long-term Interest Rate Conundrum: Not Unraveled Yet?
Tao Wu
There is a well-worn story that illustrates how economists view financial markets (and, perhaps, the rest of the world). An economist and a non-economist are walking down the street. The non-economist spots a $20 bill on the sidewalk and starts to reach for it.
-
A Tale of Two Monetary Policies: Korea and Japan
Thomas F. Cargill
In most countries’ experience, the course of financial liberalization—much like the course of true love in Shakespeare—”never did run smooth.” The process of reforming an economy from one where the government takes the lead in allocating financial and real resources to one where market forces determine economic outcomes can involve choices and consequences that are painful and costly.
-
Financial Liberalization: How Well Has It Worked for Developing Countries?
Joshua Aizenman
At the beginning of the 1990s, policy doctors were almost unanimous in advocating a strong dose of capital and financial market liberation for developing countries as a way to improve their prospects for economic growth. The expectation was that such liberalization would make foreign saving available to local entrepreneurs, who would invest it in building the businesses, homes, and other infrastructure of their countries’ economies.
-
Gains in U.S. Productivity: Stopgap Measures or Lasting Change?
Mary C. Daly
The performance of productivity in the U.S. economy has delivered some big surprises over the last several years. One surprise was in the latter half of the 1990s, when productivity growth surged to average an annual rate of over 3%, more than twice as fast as the rate in the previous two decades.
-
Productivity and Inflation
Janet L. Yellen
Several recent developments have raised concerns about a productivity slowdown in the U.S. that could slow economic growth and boost inflation. For example, after soaring at the astounding rate of nearly 4-1/2% in 2002, 2003, and the first half of 2004, nonfarm labor productivity growth slowed to around 1-3/4% in the third quarter of last year and to only 3/4% in the fourth quarter.
-
Emerging Markets and Macroeconomic Volatility: Conference Summary
Reuven Glick and Diego Valderrama
The last decade has witnessed a series of major macroeconomic crises in emerging market economies. Typically these crises have been characterized by the sudden stop of capital inflows, the collapse of fixed exchange rate regimes, falls in asset prices, and sharp declines in output.
-
Help-Wanted Advertising and Job Vacancies
Rob Valletta
The job vacancy rate, which represents employers’ unmet labor demand, is an important indicator of the short-term outlook for hiring and job creation. Because there is no continuous aggregate vacancy series in the United States, analysts and observers interested in labor demand and hiring activity have relied on the Conference Board’s “Help-Wanted Advertising Index” to measure changes in job vacancies over time.