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Economic Research

Liberty Street Economics
A Check-In on the Mortgage Market
Mortgage balances increased by $131 billion in the second quarter, according to the latest Quarterly Report on Household Debt and Credit from the New York Fed’s Center for Microeconomic Data. Following a steep rise in home prices since 2019, several housing markets have seen dips in prices and concerns were sparked about the state of the mortgage market. The authors disaggregate mortgage balances and delinquency rates by type and region to better understand the landscape of the current mortgage market.
By Andrew F. Haughwout, Donghoon Lee, Jonathan Lee, Joelle Scally, and Wilbert van der Klaauw
Financial Intermediaries and the Changing Risk Sensitivity of Global Liquidity Flows
Global risk conditions have historically been major drivers of cross-border capital flows and the global financial cycle. What happens to these global liquidity flows when risk sentiment changes? The authors examine how the sensitivity to risk of global financial flows changed following the global financial crisis (GFC) and find that while the risk sensitivity of cross-border bank loans was lower following the GFC, that of international debt securities remained the same as before.
By Stefan Avdjiev and Linda S. Goldberg
Photo: Imposing bank facade with columns bathed in dramatic light in black setting, conveying shadow banking. Ai generated image.
How Shadow Banking Reshapes the Optimal Mix of Regulation
Decisions that are privately optimal often impose externalities on other agents, resulting in regulations aimed at implementing socially optimal outcomes. In the banking industry, regulations are particularly heavy because these externalities are large enough to culminate in financial crises. As the toolkit for regulating banks and bank-like institutions has expanded, banks have restructured activities into shadow banking to lessen their regulatory burden. The author explores the optimal mix of prudential tools for bank regulators in a range of environments.
By Kinda Hachem
Who Lends to Households and Firms?
The financial sector in the U.S. economy is deeply interconnected. The authors’ previous work provided a substantial reassessment of which financial sectors are financing lending to the real sector as a whole—households plus nonfinancial firms. Now, they delve deeper into the differences between the financial sector’s lending to households and nonfinancial firms, both in terms of direct lending as well as patterns of “adjusted lending,” accounting for the network of claims financial subsectors have on each other.
By Nina Boyarchenko and Leonardo Elias
The Rise in Deposit Flightiness and Its Implications for Financial Stability
Deposits are often perceived as a stable funding source for banks. However, the risk of deposits rapidly leaving banks—known as deposit flightiness—has come under increased scrutiny following the failures of Silicon Valley Bank and other regional banks in March 2023. The authors show that deposit flightiness is not constant over time but instead may amplify the banking sector’s response to central bank policies such as quantitative easing.
By Kristian Blickle, Jian Li, Xu Lu, and Yiming Ma
The Fed’s Treasury Purchase Prices During the Pandemic
In March 2020, the Federal Reserve began purchasing U.S. Treasury securities to address the market disruptions caused by the pandemic. The authors assess the execution quality of those purchases by comparing the Fed’s purchase prices to contemporaneous market prices. They find that the Fed’s execution quality was unusually good in 2020, as the Fed bought Treasuries at prices appreciably lower than prevailing market offer prices.
By Ellen Correia Golay, Maximilian Dunn, Michael J. Fleming, Peter Johansson, Isabel Krogh, Or Shachar, and Joshua Younger
RESEARCH TOPICS
Applied Macroeconomics
and Econometrics Center
The mission of the Applied Macroeconomics and Econometrics Center (AMEC) is to provide intellectual leadership in the central banking community in the fields of macro and applied econometrics.

Data Releases
Global Supply Chain Pressure Index
(Updated: Monthly)

Measuring the Natural Rate of Interest
(Updated: Quarterly)

Multivariate Core Trend Inflation
(Updated: Monthly)

The New York Fed DSGE Model
(Updated: Quarterly)

New York Fed Staff Nowcast
(Updated: Weekly)

Outlook-at-Risk
(Updated: Monthly)

Treasury Term Premia
(Updated: Daily)

Yield Curve as a Leading Indicator
(Updated: Monthly)
Center for Microeconomic Data
Photo: a four-panel picture of people cleaning up after natural disasters
Losses from Natural Disasters
Losses from Natural Disasters provides county-level estimates of the economic and human impact of extreme weather events in the United States.
Reserve Demand Elasticity (RDE)
RDE estimates provide a quantitative measure of the ampleness of reserves in the U.S. banking system in real time. New data are published monthly.
Economic Heterogeneity Indicators (EHIs)
The EHIs are broad-based economic indicators that measure macroeconomic outcomes experienced by different demographic, economic, and geographic groups on both a regional and national level.
Corporate Bond Market Distress Index (CMDI)
The CMDI is a summary metric of corporate bond market functioning based on information from multiple sources including measures of primary market issuance and pricing, secondary market pricing and liquidity conditions, and the relative pricing between traded and nontraded bonds. It updates monthly.
Regional Surveys
Monthly surveys conducted by the New York Fed track the sentiment of executives at regional manufacturing and service-sector firms regarding business conditions.

Data Releases
Empire State Manufacturing Survey
(Updated: Monthly)

Business Leaders Survey
(Updated: Monthly)

Regional Business Surveys:
Special Topics
(Updated: Quarterly)
Regional Employment Trends
These interactive charts track employment in state and metro regions in the Federal Reserve’s Second District, utilizing the New York Fed’s early benchmarks of payroll employment data. It updates monthly.
Mapping Home Price Changes
Explore year-over-year changes in home prices since 2003, both regionally and nationally, using this dynamic map — updated with new home price index data on a monthly basis. Hover over a county for granular data.
Early Benchmarked Employment Data
Monthly releases of early benchmarked employment figures for New York State, New Jersey, Puerto Rico, and the U.S. Virgin Islands, as well as the metropolitan areas in New York and Northern New Jersey
The Labor Market for Recent College Graduates
Conditions remained challenging for recent college graduates during the second quarter of 2025. The unemployment rate averaged 5.3 percent, in line with the first quarter, and the underemployment rate held steady at just over 41 percent.
Recent Publications
A Practitioner’s Note on the Shapley-Owen-Shorrocks Decomposition
The authors provide a simple overview of the Shapley-Owen-Shorrocks decomposition, an effective alternative when studying non-linear outcomes that come from the interaction of various factors. They show that using the Shapley-Owen value, extended to inequality decompositions in Shorrocks (1999, 2013), provides an additive decomposition that sums to one and is easily interpretable in terms of the contribution of different inputs (or groups of them) to some aggregate outcome. They also provide several examples to help implement the approach.
Richard Audoly, Rory McGee, Sergio Ocampo, and Gonzalo Paz-Pardo, Staff Report 1163, August 2025
Nonlinear Micro Income Processes with Macro Shocks
The authors propose a nonlinear framework to study the dynamic transmission of aggregate and idiosyncratic shocks to income by leveraging both macro and micro data. Their approach makes it possible to empirically examine how business-cycle fluctuations modulate the persistence of heterogeneous individual histories and the risk faced by households. This information is essential for documenting the dynamics of income inequality over the business cycle and for the design of optimal monetary and fiscal policies.
Martín Almuzara, Manuel Arellano, Richard Blundell, and Stéphane Bonhomme, Staff Report 1162, August 2025
Understanding the Pricing of Carbon Emissions: New Evidence from the Stock Market
Are carbon emissions priced in equity markets? The question is crucial for evaluating how climate-related exposures may affect asset valuations, capital allocation, and the transmission of monetary policy. The authors develop a stylized model and derive and test new predictions using data from the U.S. stock market. They find convincing evidence that emissions intensity is priced in equity markets but is highly sensitive to the inclusion of a few “super emitters,” mostly firms operating in electric power generation.
Matteo Crosignani, Emilio Osambela, and Matthew Pritsker, Staff Report 1161, August 2025
Can Redemption Fees Prevent Runs on Funds?
In September 2008, the failure of Lehman Brothers sparked a $400 billion run on prime money market funds. The Securities and Exchange Commission (SEC) introduced a reform in 2014 in response, which allowed a fund to limit redemptions and impose a redemption fee when its liquid assets fell below a threshold. The authors study how redemption fees can best be used to prevent runs, with the goal of providing a framework for evaluating reform proposals.
Xuesong Huang and Todd Keister, Staff Report 1160, August 2025
Market Concentration and Aggregate Productivity: The Role of Demand
How does market concentration affect aggregate productivity? The authors argue that the role of demand is essential for answering this question. They study the relationship between market concentration and aggregate productivity when firm-level demand emerges from past marketing investments. They focus on the dynamics of demand to understand how it interacts with productivity at large firms. Within this framework, they explore areas including whether investments in demand that drive concentration are beneficial or detrimental to aggregate productivity.
Jeremy Pearce and Liangjie Wu, Staff Report 1159, July 2025
A Danger to Self and Others: Health and Criminal Consequences of Involuntary Hospitalization
The intent of involuntary hospitalization is to prevent individuals from harming themselves or others. Does it achieve its goals? The authors investigate and find that, for individuals whose cases are judgment calls, contrary to the intended effects of the policy, hospitalization nearly doubles the probability of dying by suicide or overdose and nearly doubles the probability of being charged with violent crime in the three months after evaluation. They provide evidence of earnings and housing disruptions as potential mechanisms.
Natalia Emanuel, Pim Welle, and Valentin Bolotnyy, Staff Report 1158, July 2025
Management and Firm Dynamism
Recent studies suggest that management plays an important role in driving productivity in firms. The authors focus on whether and how management affects firm dynamism around entry, exit, acquisitions, and divestitures. Drawing on U.S. Census and international data, their findings suggest that better-managed firms have lower costs of plant opening, closing, acquisition, and disposal, allowing them to be more dynamic. These firms also produce better-managed plants and improve the performance of the plants they acquire.
Nicholas Bloom, Jonathan S. Hartley, Raffaella Sadun, Rachel Schuh, and John Van Reenen, Staff Report 1157, July 2025
Losses from Natural Disasters: County-Level Data on Damages, Injuries, and Fatalities
The authors introduce the first comprehensive publicly available dataset on county-level damages, injuries, and fatalities from natural disasters in the U.S., including sources which report losses for geographic areas largely based on meteorological science. They map these areas to counties using geographic tools together with the spatial distribution of population, housing stock, and economic activity. Losses from Natural Disasters can be linked with other administrative data to better assess local economic conditions after natural disasters, thus supporting the Federal Reserve’s mission.
Matteo Crosignani and Martin Hiti, Staff Report 1156, July 2025
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