Search Results
Journal Article
The determinants of business investment: has capital spending been surprisingly low?
Many are worried that since 1980 capital investment by businesses has been lower than expected. Unusual circumstances, such as changes in savings patterns or in business leverage, a credit crunch, or widespread adoption of a shorter-term outlook, have been suggested as culprits. To see whether investment spending has indeed departed from its traditional determinants, this article compares capital spending during the 1980s and early 1990s with projections of spending derived from historical relationships between investment and various measures of economic activity. ; The results show that ...
Journal Article
The practice of central banking in other industrialized countries
Central banks in larger industrialized countries increasingly favor market operations, the buying and selling of securities, over standing facilities, such as lending and deposit facilities, in conducting their monetary policies. In their market operations, foreign central banks most commonly trade securities issued or guaranteed by their governments and repurchase agreements that are backed by a variety of assets, including private securities and securities denominated in foreign currencies. Some also trade in securities that are issued by other governments or private securities that are ...
Discussion Paper
The taxation of equity, dividends, and stock prices
The Jobs and Growth Tax Relief Reconciliation Act of 2003 (JGTRRA) essentially halved the tax rate on dividends and reduced the top tax rate on capital gains. This paper explores the likely effect of JGTRRA on the composition of returns on corporations? common stock. Both larger corporations? past behavior and theory suggest that the recent tax cuts are not likely to increase dividend payouts significantly. Instead, in the short run, dividends will continue to rise in the customary way in response to the recovery in earnings. In the longer run, the tax cuts will principally reduce companies? ...
Conference Paper
Regulation of debt and equity
Journal Article
Inflation, taxes, and interest rates
Journal Article
The influence of housing and durables on personal saving
The rate of national saving declined sharply in the 1980s. Some of the explanations for this puzzling performance have considered the influence of capital gains, a reduction in the need for precautionary saving, a decline in the need for retirement saving, the effect of slower income growth, and a host of other factors. ; This article explores the relationship between personal saving and the treatment of owner-occupied housing and consumer durable goods in the national income and product accounts. It examhaes the potential consequences of understating the returns on owner-occupied houses and ...
Journal Article
Currency boards: once and future monetary regimes?
A currency board can allow a developing economy to establish its domestic currency relatively promptly and efficiently by fixing the value of its currency to that of another country and guaranteeing that its currency is backed by sufficient foreign exchange reserves. Currency boards not only provide a foundation that encourages traders and investors to accept new currencies, they also do not require sophisticated money markets and central banking operations in order to be effective. Because of these attributes, currency boards have attracted more attention, particularly in the wake of ...