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Articles 1 - 10 of 10
Full-Text Articles in Macroeconomics
Is Monetary Policy Neutral? The Effectiveness Of Monetary Policy Transmission Across The Income Distribution, Cameron Dyer
Is Monetary Policy Neutral? The Effectiveness Of Monetary Policy Transmission Across The Income Distribution, Cameron Dyer
Honors Theses
This paper analyzes the role of the interest rate channel of monetary policy on household consumption sensitivities across the income distribution. To study this, I build a heterogenous agent model where households experience interest rate shocks as a proxy for monetary policy in addition to income shocks. I find that the poorest quintile increases consumption by about 4.5% in response to a recessionary interest rate cut, with this effect weakening for each additional quintile. When interest rate shocks differ by income group, the poorest lose about 3.6% of consumption and monetary policy’s effect on aggregate consumption weakens. When the income …
The Predictive Power Of The Term Structure Under Unconventional Monetary Policies, Luying Yang
The Predictive Power Of The Term Structure Under Unconventional Monetary Policies, Luying Yang
Honors Theses
Previous research has confirmed a positive relationship between the slope of the yield spread and future economic growth. Since the start of the Great Recession, a number of developed economies have hit the zero lower bound and adopted unconventional monetary policies such as large-scale bond/asset purchase programs and negative interest rate policies. This paper finds that the yield spread’s predictive power generally deteriorates after the central bank adopts its first bond purchase program. However, there is no general pattern of how these unconventional monetary policies impact the yield spread’s forecasting ability across countries.
The Effects Of The One-Child Policy On Household Financial Decisions, Sylvia M. Xu
The Effects Of The One-Child Policy On Household Financial Decisions, Sylvia M. Xu
Honors Theses
The Chinese One-Child Policy, enacted in 1979, was an attempt to decrease the population growth rate following a period of massive social and political confusion and uncertainty. While the policy was beneficial to curbing the population growth in China, it also introduced unintentional consequences, including sex imbalance, and other demographic differences. The goal of this paper is to examine the economic behavior and financial decisions of son-families and daughter-families across different provinces and regions of China, which have varying levels of sex imbalance, as a result of a cultural preference for sons. These financial decisions include the household saving rate, …
The Macroeconomic Effect Of Currency Union Dissolution: Evidence From The Narrative, Marcus Josefsson
The Macroeconomic Effect Of Currency Union Dissolution: Evidence From The Narrative, Marcus Josefsson
Honors Theses
In the face of the growing importance of alternative monetary arrangements throughout the world, the economics literature contains contradictory explanations for the impact of currency union dissolution. Some argue that dissolving a union removes limitations to growth, while others contend that the ensuing uncertainty drives weaker macroeconomic performance. In this paper, I present empirical analysis of the macroeconomic effect of dissolving currency unions. I utilize a narrative approach to address asymmetries in the underlying motivations for different dissolutions, and find that the absence of economic concerns driving dissolution leads to improved growth in the post dissolution period. Further, evidence for …
Does Exchange Market React To Central Bank Governor Replacements: Evidence From A New Dataset Using Narrative Approach, Siyang Xu
Honors Theses
This paper contributes to the literature that analyzes the exchange market reaction to the event of a central bank governor replacement. In order to solve the endogeneity problem, we develop a narrative approach-based on reports from credible newspapers-that classifies central bank governor replacements by their nature and causes. Using this new dataset on central bank independence for 31 countries over the period 1967-2012, we decompose all replacements into endogenous and exogenous cases with respect to inflation and financial market performance. We find that such a distinction is critical in understanding the exchange market reactions. We show that i) endogenous replacements, …
Continuity Of Fdi: Determinants And Effects On Growth, Loredana Popescu
Continuity Of Fdi: Determinants And Effects On Growth, Loredana Popescu
Honors Theses
The literature on foreign direct investment (FDI) provides evidence on the relation from FDI to growth in the presence of some absorptive qualities such as existing level of development, financial market depth, trade policies and human capital thresholds. The analysis of FDI inflows in the literature so far does not include an investigation of discontinuity, or of lack of steady positive flows. Discontinuities are expected to depend on development levels and risk factors in the host country as they proxy for attractiveness of the target to the foreign investor. This paper investigates the continuity of FDI with its determinants and …
Cyclicality Of State Budgeting: A Political-Economy Analysis., Ian W. Cummins
Cyclicality Of State Budgeting: A Political-Economy Analysis., Ian W. Cummins
Honors Theses
This paper disentangles the effect of political ideology and budget rules on fiscal cyclicality across the U.S. states. Using panel data from 1963 to 2006, liberal states are found to be significantly less procyclical than conservative ones. The impact of balanced budget constraints is contingent on the ideological orientation of the state in which they are imposed. Tight balanced budget rules are not binding on conservative states, but are binding on liberal ones. Where they are binding, budget rules mediate the link between voter preferences and policy outcomes skewing them toward greater procyclicality.
Can Parallel Exchange Rates Forecast Commodity Prices?, John F. Roberts
Can Parallel Exchange Rates Forecast Commodity Prices?, John F. Roberts
Honors Theses
Commodity price uncertainty imposes large costs on society. On the macro level, it results in sudden and unexpected shifts in current account imbalances and real GDP volatility, while on the micro level, it leads to allocation inefficiencies. Accurate price forecasts have the potential to remove some of this uncertainty and allow for a more efficient distribution of resources, and thus, an increase in social welfare. Despite the obvious gains to be had from accurate commodity price forecasts, few models have been able to deliver these results. Chen, Rogoff and Rossi (2008) were the first to find a promising link between …
Stock Markets And Household Wealth: Can A Stock Market Crash Cause A Recession In The U.S. Economy?, Ishan Singh
Stock Markets And Household Wealth: Can A Stock Market Crash Cause A Recession In The U.S. Economy?, Ishan Singh
Honors Theses
Stock market wealth effects on the level of consumption in the United States economy have been constantly debated; there is evidence for arguments for and against its prominence and its symmetry. This paper seeks to investigate the strength of its negative effect by creating models to analyze unexpected shocks to the Standard and Poor's 500 index. First, a transmission mechanism between the stock market and GDP is established through the use of second-order vector autoregressive models. Following which, theory from the life cycle model and adaptations of previous researchers' models are used to create a structural model. This paper finds …
An Analysis Of Attendance At Major League Baseball Spring Training Games, Michael R. Donihue, David Findlay, Peter Newberry
An Analysis Of Attendance At Major League Baseball Spring Training Games, Michael R. Donihue, David Findlay, Peter Newberry
Faculty Scholarship
This paper examines the determinants of game-day attendance during Major League Baseball’s 2002 spring training season in Florida. Our model of game-day attendance includes location, quality of game, and time and weather variables. A censored Tobit estimation procedure is used to estimate our model. Our results indicate that the quality of the game, average ticket price, and several location-specific factors affect attendance. Specifically, our results suggest that changes in income have no effect on attendance while increases in ticket prices cause reductions in attendance. Furthermore, the estimated price elasticity of demand for Major League Baseball during the spring training season …