Search Results

(refine search)

SORT BY: PREVIOUS / NEXT

All:
Title:
Author:
Abstract:
Keywords:

+ Add Search Parameter

Journal Article
U.S. Federal Debt Has Increased, but Appears Sustainable for Now
Bi, Huixin; Yang, Shu-Chun S.; Shen, Wenyi (2020-11-16)
The unprecedented fiscal stimulus packages that Congress passed earlier this year provided timely assistance to households and businesses, but also led to a sharp increase in U.S. federal government debt. We find that the current net federal debt level of about 100 percent of GDP does not pose a threat to fiscal sustainability. Over a longer horizon, debt sustainability will depend, to a large extent, on whether the federal government can curb mandatory spending or raise taxes.
Economic Bulletin

Discussion Paper
Financing Workforce Development in a Devolutionary Era
Andreason, Stuart (2016-04-01)
Workforce development financing has changed significantly over the last 25 years. In 2008, federal funding for the traditional workforce development system was 83 percent lower in real terms than it had been in 1980. As the federal system plays a smaller role in workforce development financing, the job training landscape better represents a “marketplace” where students and job seekers use federal training vouchers and grant and student loan money from various sources, primarily the Higher Education Act’s Pell Grant and Federal Student Loan programs. Additionally, increasing volatility ...
FRB Atlanta Community and Economic Development Discussion Paper , Paper 2016-02

Working Paper
Are Government Bonds Net Wealth or a Liability? ---Optimal Debt and Taxes in an OLG Model with Uninsurable Income Risk
Chien, YiLi; Wen, Yi; Wu, HsinJung (2020-04-08)
The rapidly growing national debt in the U.S. since the 1970s has alarmed and intrigued the academic world. Consequently, the concept of dynamic (in)efficiency in an overlapping generations (OLG) world and the importance of the heterogeneous-agents and incomplete markets (HAIM) hypothesis to justify a high debt-to-GDP ratio have been extensively studied. Two important consensus emerge from this literature: (i) The optimal quantity of public debt is positive—due to insufficient private liquidity to support private saving and investment (see, e.g., Barro (1974), Woodford (1990), and Aiyagari ...
Working Papers , Paper 2020-007

Working Paper
Sovereign Default and Monetary Policy Tradeoffs
Leith, Campbell; Bi, Huixin; Leeper, Eric M. (2018-03-02)
The paper is organized around the following question: when the economy moves from a debt-GDP level where the probability of default is nil to a higher level?the ?fiscal limit?? where the default probability is non-negligible, how do the effects of routine monetary operations designed to achieve macroeconomic stabilization change? We find that the specification of the monetary policy rule plays a critical role. Consider a central bank that targets the risky rate. When the economy is near its fiscal limit, a transitory monetary policy contraction leads to a sustained rise in inflation, even ...
Research Working Paper , Paper RWP 18-2

Working Paper
Did the Tax Cuts and Jobs Act Create Jobs and Stimulate Growth?
Kumar, Anil (2022-04-21)
The Tax Cuts and Jobs Act (TCJA) of 2017 is the most extensive overhaul of the U.S. income tax code since the Tax Reform Act of 1986. Existing estimates of TCJA’s economic impact are based on economic projections using pre-TCJA estimates of tax effects. I exploit plausibly exogenous state-level variation in tax changes from TCJA and find that an income tax cut equaling 1 percent of GDP led to a 1.3 percentage point faster job growth and nearly 1.5 percentage points higher GDP growth. The impact on growth was the strongest in the year of the tax change, with much smaller effects in the ...
Working Papers , Paper 2001

Working Paper
The Macro Effects of Climate Policy Uncertainty
Fried, Stephie; Peterman, William B.; Novan, Kevin (2021-03-19)
Uncertainty surrounding if and when the U.S. government will implement a federal climate policy introduces risk into the decision to invest in capital used in conjunction with fossil fuels. To quantify the macroeconomic impacts of this climate policy risk, we develop a dynamic, general equilibrium model that incorporates beliefs about future climate policy. We find that climate policy risk reduces carbon emissions by causing the capital stock to shrink and become relatively cleaner. Our results reveal, however, that a carbon tax could achieve the same reduction in emissions at less than half ...
Finance and Economics Discussion Series , Paper 2021-018

Working Paper
Reforming the US Long-Term Care Insurance Market
Braun, R. Anton; Kopecky, Karen A. (2024-08-14)
Nursing home risk is significant and costly. Yet, most Americans pay for long-term care (LTC) expenses out-of-pocket. This chapter examines reforms to both public and private LTCI provision using a structural model of the US LTCI market. Three policies are considered: universal public LTCI, no public LTCI coverage, and a policy that exempts asset holdings from the public insurance asset test on a dollar-for-dollar basis with private LTCI coverage. We find that this third reform enhances social welfare and creates a vibrant private LTCI market while preserving the safety net provided by public ...
Working Papers , Paper 24-17

Working Paper
The Determination of Public Debt under both Aggregate and Idiosyncratic Uncertainty
Chien, YiLi; Wen, Yi (2020-08-13)
We use an analytically tractable model to show that the Ramsey planner's decisions to finance stochastic public expenditures under uninsurable idiosyncratic risk implies a departure from tax smoothing. In the absence of state-contingent bonds the government's attempt to balance the competing incentives between tax smoothing and individual consumption smoothing---even at the cost of extra tax distortion---implies a bounded stochastic unit root component in optimal taxes. Nonetheless, a sufficiently high average level of public debt to support individuals’ self-insurance position is welfare ...
Working Papers , Paper 2019-038

Working Paper
The Ramsey Steady-State Conundrum in Heterogeneous-Agent Economies
Chien, YiLi; Wen, Yi (2023-02-06)
In infinite horizon, heterogeneous-agent and incomplete-market models, the existence of an interior Ramsey steady state is often assumed instead of proven. This paper makes two fundamental contributions: (i) We prove that the interior Ramsey steady state assumed by Aiyagari (1995) does not exist in the standard Aiyagari model. Specifically, a steady state featuring the modified golden rule and a positive capital tax is feasible but not optimal. (ii) We design a modified, analytically tractable version of the standard Aiyagari model to unveil the necessary and/or sufficient conditions for the ...
Working Papers , Paper 2022-009

Working Paper
Are Unconditional Lump-sum Transfers a Good Idea?
Wen, Yi; Chen, Yunmin; Chien, YiLi; Yang, C. C. (2021-06-14)
The role of unconditional lump-sum transfers in improving social welfare in heterogenous agent models has not been thoroughly understood in the literature. We adopt an analytically tractable Aiyagari-type model to study the distinctive role of unconditional lump-sum transfers in reducing consumption inequality due to ex-post uninsurable income risk. Our results show that in the presence of ex-post heterogeneity and in the absence of wealth inequality, unconditional lump-sum transfers are not a desirable tool for reducing consumption inequality—the Ramsey planner opts to rely solely on ...
Working Papers , Paper 2021-002

show more (41)

PREVIOUS / NEXT

Fed in Print

Search Results

FILTER BY year

FILTER BY Bank

FILTER BY Series

FILTER BY Content Type

FILTER BY Author

FILTER BY Jel Classification

FILTER BY Keywords