Search Results
Journal Article
Will Tariffs Touch Off an Inflationary Impulse? Business Execs Think So.
Following the inflationary surge from 2021 to 2023, which was touched off by supply chain constraints and shipping bottlenecks, we evaluate a new panel of own-firm price and unit cost growth expectations in the Atlanta Fed's Survey of Business Uncertainty for signs that the anticipated impact from tariffs is broadening beyond directly affected firms. We find evidence for the potential of tariffs to touch off another bout of high inflation. First, firms that are directly exposed to tariffs have increased their year-ahead price growth expectations sharply (by 0.7 percentage points). Second, ...
Journal Article
Industry-Level Sources for Solid US Employment Growth: Running on Empty or More Room to Run?
The labor market has exhibited solid growth in the past few years, largely due to the strong growth in three industries: Health Care and Social Assistance (HCSA), Leisure and Hospitality (LH), and Government (G). However, while the level of payroll employment surpassed prepandemic levels, a gap of approximately 3.4 million remains between these levels and the level of employment that would have been expected in the absence of the pandemic. Using data on vacancies and vacancy yields, we estimate that HCSA and G are quickly approaching their prepandemic trend trajectories. LH, however, is not ...
Working Paper
The Effect of Unemployment Insurance Eligibility in Equilibrium
In the United States, workers whose past earnings were below a threshold are generally ineligible for unemployment insurance (UI), creating a discontinuous jump in the value of being unemployed. Using a regression discontinuity design with administrative panel data, we estimate a sizable local effect from UI eligibility on earnings in the next employer, around 10 percent per quarter. This evidence, however, understates UI’s causal effect because of endogenous non-compliance. It also does not distinguish between underlying reasons for higher re-employment earnings, a higher share of ...
Working Paper
Firm Exit and Liquidity: Evidence from the Great Recession
This paper studies the role of credit constraints in accounting for the dynamics of firm exit during the Great Recession. We present novel firm-level evidence on the role of credit constraints on exit behavior during the Great Recession. Firms in financial distress, with tighter access to credit, are more likely to default than firms with more access to credit. This difference widened substantially in the Great Recession while, in contrast, default rates did not vary much by size, age, or productivity. We identify conditions under which standard models of firms subject to financial frictions ...
Working Paper
Stimulus through Insurance: The Marginal Propensity to Repay Debt
Using detailed micro data, we document that households often use "stimulus" checks to pay down debt, especially those with low net wealth-to-income ratios. To rationalize these patterns, we introduce a borrowing price schedule into an otherwise standard incomplete markets model. Because interest rates rise with debt, borrowers have increasingly larger incentives to use an additional dollar to reduce debt service payments rather than consume. Using our calibrated model, we then study whether and how this marginal propensity to repay debt (MPRD) alters the aggregate implications of fiscal ...
Journal Article
Assessing the Recent Rise in Unemployment
The unemployment rate has risen over half a percentage point since the second quarter of 2023. Individual survey data underlying the unemployment rate can help in assessing which labor market transitions account for this rise. One dominant factor appears to be a fall in the job-finding rate—the share of unemployed individuals finding employment. The duration of unemployment has also increased recently. In past decades, these patterns have frequently occurred during the onset of recessions, which suggests that these data should be closely monitored.
Journal Article
“Unemployment claims hit 8½-year low”: interpret with caution
An unemployment statistic based on unemployment insurance is less useful because it does not measure unemployment itself.
Journal Article
Earnings Losses Through Unemployment and Unemployment Duration
The longer the unemployment duration, the larger the loss.
Journal Article
The Connection Between Social Security Disability Insurance and High Unemployment
Even as national unemployment has fallen, counties with persistently high unemployment also have more disability.
Journal Article
The Survival Rate of the Smallest Establishments During the Great Recession
Very small establishments closed at about twice the rate of larger ones.