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Economic Research

Recent Publications
Access to Credit and Financial Health: Evaluating the Impact of Debt Collection

The authors analyze the effect of debt collection practices on both consumer credit and indicators of financial health.  They find consistent evidence that restricting collection activities leads to a decrease in access to credit and to a deterioration in indicators of financial health—including a rise in delinquent balances and decrease in credit scores.

By Julia Fonseca, Katherine Strair, and Basit Zafar, Staff Reports 814, May 2017
Transformation of Corporate Scope in U.S. Banks: Patterns and Performance Implications

The authors use a new data set—containing the organizational structure of the entire population of U.S. bank holding companies over time—to present the first study of the transformation of the business scope of U.S. banks. Their results suggest that broader scope is beneficial during periods of turbulence, although expanding into new areas when credit conditions are tight is not.

By Nicola Cetorelli, Michael G. Jacobides, and Samuel Stern, Staff Reports 813, May 2017
Safety, Liquidity, and the Natural Rate of Interest
Why are U.S. interest rates so low today? The authors point to a higher “convenience yield”—the premium that investors are willing to pay for safety and liquidity. This increase, together with a slowdown in economic growth, explains much of the decline in estimates of the natural rate of interest since the late 1990s.
By Marco Del Negro, Domenico Giannone, Marc P. Giannoni, and Andrea Tambalotti, Staff Reports 812, May 2017
How Does For-Profit College Attendance Affect Student Loans, Defaults, and Earnings?
For-profit schools tend to serve students from more disadvantaged backgrounds, so it is important to isolate the causal effect of for-profit enrollment on educational and labor market outcomes. The authors use a novel strategy to estimate the effect of attending a for-profit college relative to a local public college or university on graduation rates, financial aid, student debt, and future earnings.
By Luis Armona, Rajashri Chakrabarti, and Michael Lovenheim, Staff Reports 811, April 2017
Interest Rate Conundrums in the Twenty-First Century
Our authors find that “conundrums”—six- or twelve-month periods in which short-term interest rates and long-term interest rates move in opposite directions—have become far more common since 2000. They show that the excess sensitivity of long-term interest rates to high-frequency movements in short-term rates has grown stronger, while the positive association between low-frequency changes in short- and long-term rates has weakened.
By Samuel G. Hanson, David O. Lucca, and Jonathan H. Wright, Staff Reports 810, March 2017
The Pre-Crisis Monetary Policy Implementation Framework
The Federal Reserve’s monetary policy implementation framework changed during the financial crisis of 2007-08 owing to the substantial increase in reserves resulting from unconventional policy measures. In this paper, the authors assess the Fed’s pre-crisis framework in order to facilitate a better understanding of changes in monetary policy implementation since the crisis.
By Alexander Kroeger, John McGowan, and Asani Sarkar, Staff Reports 809, March 2017