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Journal Article
Monetary Policy Implementation with Ample Reserves
The Federal Reserve currently implements its interest rate policy under a framework known as the floor system. In order for the floor system to operate smoothly, there must be sufficient liquidity in the federal funds market. The ongoing goal of quantitative tightening (QT) is to reach the minimal level of market liquidity required to implement monetary policy efficiently and effectively, also known as an ample reserves regime. We briefly discuss changes in the monetary policy framework from the previous corridor system to today’s floor system as well as the circumstances that brought them ...
What Does History Reveal about Reducing the National Debt Burden?
A look at the U.S. national debt since World War II reveals that economic growth and fiscal austerity (i.e., spending cuts and raising taxes) are two of the ways to reduce the debt burden.
Working Paper
The Impact of the 2017 Tax Cuts and Jobs Act on U.S. Multinationals’ Intangible Assets
This paper investigates the impact of the 2017 Tax Cuts and Jobs Act (TCJA) on U.S. multinationals’ intangibles. We develop a theoretical model that incorporates key provisions of the TCJA—the Global Intangible Low-Taxed Income (GILTI) and the Foreign-Derived Intangible Income (FDII)—and derive testable implications for changes in licensing and patent transfer patterns. Using data on international royalty flows and patent assignments, we test the model’s predictions. Our findings suggest that the TCJA may have impacted profit shifting strategies through intangibles, aligning with our ...
Bank Reserves since the Start of Quantitative Tightening
The Fed has been reducing its balance sheet since mid-2022, which also trims the overall level of bank reserves. What other factors might be affecting the demand for bank reserves?
Japan’s Consolidated Balance Sheet and Challenges for Monetary Policy
An analysis breaks down Japan’s consolidated balance sheet and considerations surrounding fiscal and monetary policies.
What Lessons Can Be Drawn from Japan’s High Debt-to-GDP Ratio?
Taking into account other public liabilities and assets can provide a clearer picture when comparing Japan’s debt-to-GDP ratio with that of the U.S.
The Evolution of Global FDI: Patterns of Investment in Tax Havens and China
FDI in major economies such as China has grown steadily while FDI in tax havens has stabilized or declined amid a global rise in investment abroad.
What’s behind Japan’s High Government Debt?
With a rapidly aging population and economic growth near zero, Japan has faced a persistent fiscal challenge: a large social security deficit.
Journal Article
The Impact of the 2017 Tax Cuts and Jobs Act on U.S. Multinationals' Intangible Assets
This article investigates the impact of the 2017 Tax Cuts and Jobs Act (TCJA) on the intangibles of U.S. multinationals. We develop a theoretical model that incorporates key provisions of the TCJA—Global Intangible Low-Taxed Income (GILTI) and Foreign-Derived Intangible Income (FDII)—and derive testable implications for changes in licensing and patent transfer patterns. Using data on international royalty flows and patent assignments, we test the model’s predictions. Our findings suggest that the TCJA may have impacted profit-shifting strategies through intangibles, aligning with our ...
Journal Article
The Recent Rise of U.S. National Wealth
The latest large surge in the U.S. wealth-to-GDP ratio has dwarfed the peaks seen in the past.