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Economic Research

Liberty Street Economics
AI Adoption and Employment Expectations: Evidence from a Survey of Small Business Owners
The authors use data from the 2025 edition of the Small Business Credit Survey (SBCS) to examine the 12-month forward employment and revenue expectations of AI users. They find that firms currently using AI are significantly more likely than non-users to expect increased employment and revenues over the next year, even after accounting for firm and owner characteristics and location. Revenue expectations are most optimistic for AI users that report facing operational challenges in utilizing technology.
By Will Aarons and Asani Sarkar
Partial View of the Federal Reserve ("Fed") Headquarters Office Building in Washington, D.C.
Firm Heterogeneity and the Response of Investment to Monetary Policy
It is well known that monetary policy affects firms’ investment decisions. But which firms are the most responsive to changes in interest rates? And does this responsiveness vary over time? In this post based on their recent Staff Report, the authors explore how investment responsiveness to monetary policy changes across firms and over time. Their findings underscore the importance of considering the entire distribution of investment responses rather than focusing on the average effect.
By Thomas Drechsel, Daniel Lewis, Davide Melcangi, and Laura Pilossoph
How Fast Do Tariffs Pass Through into Consumer Prices?
The 2025-26 U.S. tariffs have renewed the question of how much of a tariff reaches consumers, and how quickly. This post traces tariffs through import, domestic producer, and retail prices for U.S. consumer goods. About a quarter of a tariff increase passes through to consumer prices after one year. Roughly two-thirds comes from imported goods; the rest from U.S.-made goods, as producers face higher input costs and less import competition.
By Mary Amiti, Sebastian Heise, and David E. Weinstein
tree fallen on a small white house
Insured, but Still on the Hook: Who Bears the Most Risk in Homeowner's Insurance?
Although millions have homeowner’s insurance, policyholders are still "on the hook” because deductibles and coverage limits leave them responsible for part of a loss. Insurers do this because they cannot perfectly observe how well homeowners maintain or protect their properties (a problem known as "moral hazard"). The authors quantify the costs of keeping homeowners on the hook: How costly is moral hazard in homeowner's insurance? How much risk must households retain to preserve these incentives? And who ultimately bears that residual risk?
By Hyeyoon Jung and Jaehoon (Kyle) Jung
Futuristic global financial data visualization, world map and digital globe with candlestick chart, stock trading analytics, forex market dashboard, fintech infographic, big data interface
Navigating Geoeconomic Risk in the U.S. Stock Market
Geoeconomic risk—the risk that firms incur valuation losses when countries deploy economic, trade, or financial leverage for geopolitical aims—has become a first-order concern for investors. The authors document that domestic U.S. stocks expose investors to substantial geoeconomic risk through firms' global supply-chain relationships, affecting investors' returns and portfolio allocation.
By Matteo Crosignani, Lina Han, and Marco Macchiavelli
photo of the Federal Reserve building in Washington D.C. colorized to cyan.
The Role of Repos in Monetary Policy Implementation
After discussing private market participants that are active in the repo market for profit-making motives in the first two posts of this series, the authors look at how central banks are also active repo market participants, but that their reasons often differ from those of private participants. The authors discuss how central banks use repos to manage liquidity in the financial system and implement monetary policy.
By Gara Afonso, Jun-Davinci Choi, Gonzalo Cisternas, and Will Riordan
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)

Labor Market Tightness 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
AI generated, people walking in office building.
Labor Market Tightness Index
The HPW Labor Market Tightness Index is an indicator of labor market tightness for summarizing current wage pressures and predicting wage inflation.
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
Labor market conditions remained challenging for recent college graduates through the second quarter of 2026. The unemployment rate stayed elevated at about 5.6 percent, and the underemployment rate edged up to 42 percent.
Recent Publications
Remote Work from the Office
Roughly half of in-office days are spent entirely on Zoom calls or doing solo work according to a new survey of college-educated Americans. These workers commute in just to work remotely from the office. Existing measures of remote work that focus solely on working from home miss up to three quarters of its true prevalence. The authors use a collage of data to unpack the drivers of working remotely from the office.
Natalia Emanuel and Emma Harrington, Staff Report 1211, October 2026
From Moore’s Law to Eroom’s Law: Power Constraints and the Productivity Slowdown
Economic growth depends on combining existing inputs into new inventions, but these combinations are not always physically feasible. The author develops a growth model and establishes conditions for a unique balanced growth path, where electronic miniaturization and power efficiency grow at the same rate. When power-efficiency research becomes harder, both total research employment and productivity growth fall. With gradual adjustment of research employment, he constructs a local equilibrium transition in which more researchers temporarily coexist with slower productivity growth.
Pablo D. Azar, Staff Report 1209, October 2026
Consumption, Savings, and Earnings Responses to Financial Windfalls
How do individuals’ economic decisions change when their financial resources increase? The authors estimate the causal effects of a financial windfall on consumption, savings, and wage earnings using linked administrative data on a large sample of Canadian lottery winners. They estimate how lottery winnings affect consumption, measured through credit card spending, savings through financial asset accumulation and debt repayment, and wage earnings from tax records. They then examine how these responses vary across the income distribution.
Rajashri Chakrabarti, Philippe d’Astous, Kory Kroft, Sheisha Kulkarni, Vyacheslav Mikhed, Matthew J. Notowidigdo, Sahil Raina, and Barry Scholnick, Staff Report 1208, October 2026
Fleeting Forbearance in a World of Persistent Financial Distress
Relative to the persistent delinquency typically observed in consumer credit, mortgage forbearance during the COVID-19 pandemic was surprisingly short-lived. The authors use a structural model estimated on credit panel microdata, combined with survey data, to identify two forces that have received little attention in the literature: selection and expectations of income loss. They find that the power of forbearance, a frequent macroeconomic policy, hinges on borrower selection, shock realizations, and revisions to expectations following those realizations.
José Mustre-del-Río, Juan M. Sánchez, and Kartik Athreya. Staff Report 1207, October 2026
Cyclical Earnings, Career and Employment Transitions
Career changes across occupations are central to the cyclical behavior of workers’ earnings growth. The authors study the joint behavior of earnings risk and career changes over the business cycle. They demonstrate that career changes, which they observe as occupational mobility, are the main driver behind the cyclical patterns of the annual earnings growth distribution, and that employer mobility on its own does not contribute as much as occupational mobility in shaping cyclical earnings growth.
Carlos Carrillo-Tudela, Ludo Visschers, and David Wiczer, Staff Report 1206, September 2026
How Do Banks Build Equity Capital?
Understanding how bank equity capital evolves over time is critical to understanding the risks facing individual banks, the banking system, and the broader economy. The authors analyze the components of equity capital to document how U.S. bank holding companies built and depleted equity capital from 1990 to 2024. By bringing together earnings, stock issuance, and shareholder payouts within a unified framework, they quantify the contributions of these components and characterize the patterns that shape equity capital over time.
Lily Gordon and Beverly Hirtle, Economic Policy Review 32, no. 1, September
When Higher Stakes Weaken Security
Settlement systems are designed so that security rises with the stakes: when a bank clears a large payment, the legal framework behind it does not weaken. Proof-of-Work (PoW) blockchains attempt to replace this legal infrastructure with a purely incentive-based mechanism, substituting the authority of clearinghouses and courts with costly computation. The authors provide the first causal evidence that, in a major PoW blockchain, security can degrade with the value at stake.
Pablo D. Azar and Maryam Farboodi, Staff Report 1205, September 2026
How Do Market Expectations React to the FOMC Dot Plot?
The public pays close attention to Federal Reserve communications about future monetary policy, but how do these communications shape the public’s expectations for policy rates? These expectations have effects on longer-term interest rates and therefore on the macroeconomy. The authors explore how market expectations adjust to the information provided in the “dot plot” of the Summary of Economic Projections, which contains the Federal Open Market Committee’s (FOMC) assessment of the appropriate future path of the federal funds rate.
Stefania D’Amico, Thomas B. King, and Francisco Torralba, Staff Report 1204, September 2026


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