Atlanta Fed Working Papers

The Research Department of the Federal Reserve Bank of Atlanta publishes a working paper series to convey the research of staff economists and visiting scholars and stimulate professional discussion and exploration of economic and financial subjects.


Central Bank Digital Currencies: An Old Tale with a New Chapter

Michael D. Bordo and William Roberds
Working Paper 2022-18
December 2022
The authors consider the debut of a new monetary instrument, central bank digital currencies. Drawing on examples from monetary history, they argue that a successful monetary transformation must combine microeconomic efficiency with macroeconomic credibility.

Can Everyone Tap Into the Housing Piggy Bank? Racial Disparities in Access to Home Equity

James N. Conklin, Kristopher Gerardi, and Lauren Lambie-Hanson
Working Paper 2022-17
November 2022
The authors document significant racial disparities in approval rates and financing costs for mortgage equity withdrawal loans and find that underwriting factors such as credit scores and debt-to-income ratios can explain the vast majority of the gaps.

The Anatomy of Out-of-Sample Forecasting Accuracy

Daniel Borup, Philippe Goulet Coulombe, David E. Rapach, Erik Christian Montes Schütte, and Sander Schwenk-Nebbe
Working Paper 2022-16
November 2022
The authors develop metrics for interpreting time-series prediction models and their out-of-sample forecasting accuracy, and they use them to interpret fitted models that employ large datasets and machine learning to forecast US inflation.

The Short and the Long of It: Stock-Flow Matching in the US Housing Market

Eric Smith, Zoe Xie, and Lei Fang
Working Paper 2022-15
October 2022
In 2004 and 2005, US house prices and sales surged. In 2006, a sharp, dramatic downturn triggered the onset of the Great Recession. The authors assess how well the stock-flow matching framework explains the housing market performance during this time.

Globalization and Heterogeneity: Evidence from Hollywood

Konrad Adler and Simon Fuchs
Working Paper 2022-14
October 2022
International trade allows firms to reach a large customer base, but consumers across markets might prefer different products. The authors build a model to study trade when demand is both heterogeneous and volatile across countries and use their model to study the international box office.

Multimodal Transport Networks

Simon Fuchs and Woan Foong Wong
Working Paper 2022-13
October 2022
US freight shipments rely on a complex network of road, rail, and maritime linkages to reach their final destinations. The authors construct a model of these linkages to describe the optimal infrastructure investments for the US transportation network.

Why Aging Induces Deflation and Secular Stagnation

R. Anton Braun and Daisuke Ikeda
Working Paper 2022-12
September 2022
Many industrialized countries experienced a lengthy episode of low inflation rates, real interest rates, and growth of per capita gross domestic product before the COVID pandemic. The authors propose a lifecycle model and show how and why aging induces downward pressure on these indicators of aggregate activity.

The Good, the Bad, and the Ordinary: Estimating Agent Value-Added Using Real Estate Transactions

Chris Cunningham, Kristopher Gerardi, and Lily Shen
Working Paper 2022-11
September 2022
The authors document significant heterogeneity in real estate agent performance when selling and buying homes. Most agents do not negotiate better prices for their clients, and they do not outperform nonagents who list their own properties on the Multiple Listing Service.

Entrepreneurship through Employee Mobility, Innovation, and Growth

Salomé Baslandze
Working Paper 2022-10
September 2022
Using data on inventor mobility and firm innovation, the author examines how employees of enterprises can transition to leading their own companies. She finds that noncompete clauses in many employee contracts are too restrictive and can reduce innovation and growth.

Credit Card Debt Puzzle: Liquid Assets to Pay Bills

Claire Greene and Joanna Stavins
Working Paper 2022-9
August 2022
Does holding both liquid assets and credit card debt make sense? After all, interest rates paid on deposit accounts are lower than interest rates charged on unpaid credit card balances—yet many people make that choice. The authors look at why.

Quantifying "Quantitative Tightening" (QT): How Many Rate Hikes Is QT Equivalent To?

Bin Wei
Working Paper 2022-8
July 2022
Examining the relationship between the Fed's balance sheet policy and its interest rate policy, the author quantifies how many interest rate hikes quantitative tightening equals, and he compares the effect of tightening during normal times versus during turbulent times.

The Shift to Remote Work Lessens Wage-Growth Pressures

José Maria Barrero, Nicholas Bloom, Steven J. Davis, Brent Meyer, and Emil Mihaylov
Working Paper 2022-7
July 2022
The authors find that the shift to remote work moderates wage growth by 2 percentage points over two years, shrinking the real-wage catchup effect on near-term inflation pressures by more than half.

Is Our Fiscal System Discouraging Marriage? A New Look at the Marriage Tax

Elias Ilin, Laurence Kotlikoff, and M. Melinda Pitts
Working Paper 2022-6
June 2022
For richer or for poorer? Investigating a new measure of the marriage tax—the reduction in future spending from marrying—the authors find that the marriage tax rate, which averages 2.69 percent, reduces the probability of marrying by up to 13 percent.

The Transmission of Financial Shocks and Leverage of Financial Institutions: An Endogenous Regime-Switching Framework

Kirstin Hubrich and Daniel Waggoner
Working Paper 2022-5
June 2022
Investigating the role of leverage of financial institutions in the transmission of financial shocks to the macroeconomy, the authors find empirical evidence that the real effects of financial shocks were amplified by the leverage of financial institutions during the Great Recession.

The Downward Spiral

Jeremy Greenwood, Nezih Guner, and Karen A. Kopecky
Working Paper 2022-4
February 2022
There have been more than 500,000 opioid overdose deaths since 2000. The authors develop a framework to study the opioid epidemic and find that drops in the price of both medical prescriptions and illicit opioids combined with increases in prescribed dosages are the primary drivers.

Does Access to Free Pre-Kindergarten Increase Maternal Labor Supply?

Elias Ilin, Samantha Shampine, and Ellyn Terry
Working Paper 2022-3
February 2022
Exploring the impact of free pre-K programs on maternal participation in the labor force, the authors find that the availability of free pre-K programs increases the labor force participation rate of mothers with one child age 3 or 4 by an average of 2.3 percentage points.

Fintech Entry, Firm Financial Inclusion, and Macroeconomic Dynamics in Emerging Economies

Alan Finkelstein Shapiro, Federico S. Mandelman, and Victoria Nuguer
Working Paper 2022-2
January 2022
Examining the impact of fintech on emerging economies, the authors find that unless greater fintech entry leads to lower borrowing costs for firms that adopt fintech credit, an expanding number of fintech intermediaries will have no meaningful consequences on credit markets and business cycles in emerging economies.

Racial Disparities in Mortgage Lending: New Evidence Based on Processing Time

Bin Wei and Feng Zhao
Working Paper 2022-1
January 2022
Examining racial disparities in mortgage processing time prior to the global financial crisis, the authors find that Black borrowers are underrepresented and experience a longer processing time than White borrowers among the mortgages securitized by government-sponsored enterprises.

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