NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

18 May 2017

Profit Shifting Leads to Mismeasurement
of GDP and Productivity Growth

Shifting of profits offshore by some U.S. based multinationals causes part of the economic activity they generate to be attributed to their foreign affiliates, research by Fatih Guvenen, Raymond J. Mataloni, Jr., Dylan G. Rassier, and Kim J. Ruhl finds. Such profit shifting, which has grown since the mid-1990s, leads to understatement of both gross domestic product and aggregate productivity growth.

17 May 2017

Monetary Policy and Global Banking

In response to easing of domestic monetary policy, global banks increase their foreign reserves in currency areas with the highest interest rate, while decreasing lending in these markets, research by Falk Bräuning and Victoria Ivashina shows.

16 May 2017

Corporate Bond Market Liquidity Since the Financial Crisis

Mike Anderson and René M. Stulz analyze trading in the corporate bond market and find that price-based liquidity metrics are much better for small trades after the crisis than before. For large trades, these metrics are generally worse from 2010 to 2012 and better from 2013 to 2014, compared with 2004 to 2006.

15 May 2017

E-Cigarette Minimum Legal Sale Age Laws:
Their Effects on Youth Substance Use

After analyzing data from 1991 to 2015, Dhaval Dave, Bo Feng, and Michael F. Pesko conclude that state laws specifying a minimum legal age for purchase of e-cigarettes increased the probability of youth cigarette smoking by between 0.7 and 1.4 percentage points. About half of this increase could be attributed to smoking initiation at ages when the youths’ purchase of e-cigarettes was banned.

12 May 2017

The Effects of Federal Reserve Forward Guidance
and Asset Purchases on Financial Markets

Both the Fed’s forward guidance and its large-scale asset purchases had substantial effects on medium-term Treasury yields, stock prices, and exchange rates during the 2009-15 zero-lower bound period, according to a new study by Eric T. Swanson. Forward guidance was more effective than asset purchases at moving short-term Treasury yields, while asset purchases were more effective at moving longer-term Treasury yields, corporate bond yields, and interest rate uncertainty.

11 May 2017

Government Debt and Corporate Leverage

Using data on 40 countries between 1990 and 2014,Irem Demirci, Jennifer Huang, and Clemens Sialm document a negative relation between domestically financed government debt and corporate leverage. The negative relation is stronger for larger and more profitable firms and in countries with more developed equity markets. The findings suggest that government debt crowds out corporate debt.

10 May 2017

The Impact of New York's Universal Prekindergarten
Program on the Health of Low-Income Children

Since 2014, New York City has made all four-year-old children eligible for high-quality pre-kindergarten programs that emphasize developmental screening. Kai Hong, Kacie Dragan, and Sherry Glied find that these programs accelerate the identification of children with conditions such as asthma and deficiencies in vision of hearing that could potentially delay learning and cause behavioral problems.

9 May 2017

Consumption Inequality and Purchase Frequency

Olivier Coibion, Yuriy Gorodnichenko, and Dmitri Koustas document a decline in the frequency of shopping trips in the U.S. since 1980, largely due to the rise of club and warehouse stores, and find this explains most of the documented rise in expenditure inequality over this time period.

8 May 2017

The Value of Flexible Work Hours for Uber Drivers

If Uber drivers were required to supply labor at times set by the firm, rather than at times of their own choosing, at prevailing wages, they would reduce their hours of work by more than two-thirds, according to a study by M. Keith Chen, Judith A. Chevalier, Peter E. Rossi, and Emily Oehlsen.

5 May 2017

While Income Inequality Has Grown,
So Has Consumption by Below-Median-Income Families

Meaningful growth in consumption for below-median-income families has occurred despite a prolonged period of increasing income and consumption inequality in the United States, research by Bruce Sacerdote shows. The number of cars per household with below-median income has doubled since 1980 and the number of bedrooms per household has grown 10 percent despite decreases in household size.
 
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