Working Papers
Stimulating discussion and critical comment on research in progress.
1988
- WP 88-16
- Pricing Daylight Overdrafts
- An examination of three policy problems associated with daylight credit and an evaluation of three reform proposals to alleviate the payment system risk associated with Federal Reserve Banks’ extension of daylight credit to financial institutions. (PDF)
- WP 88-15
- Bankruptcy in the Life-Cycle Consumption Model
- An analysis assessing the sensitivity of consumption to income using a life-cycle model of consumption that incorporates the possibility of bankruptcy. (PDF)
- WP 88-14
- Money, Inflation, and Sectoral Shifts
- A presentation of a sectoral-shifts model with money that explains the short-run Phillips curve and predicts a long-run positive relationship between inflation and unemployment. (PDF)
- WP 88-13
- Decomposing TFP Growth in the Presence of Cost Inefficiency, Nonconstant Returns to Scale, and Technological Progress
- A decomposition of observed total factor productivity (TFP) growth that examines changes in returns to scale, cost efficiency, and technology and that develops several decompositions using production and cost frontiers (PDF)
- WP 88-12
- The Impact of Capital Grants on Maintenance in the Local Public Sector
- A study of how state and federal grants affect the maintenance policies of local mass-transit providers, showing that private owners of transit capital devote significantly greater resources to maintenance than do public owners of similar capital. (PDF)
- WP 88-11
- Federal Grant Policies and Public Sector Scrappage Decisions
- An examination of capital policies in the public and private sector through analysis of the scrappage decisions of local mass-transit providers, showing that the structure of federal grants has a direct impact on scrappage rates that leads to shorter equipment life in the local public sector. (PDF)
- WP 88-10
- Using SMVAM as a Linear Approximation to a Nonlinear Function: A Note
- A study contending that the linear statistical market-value accounting model (SMVAM) is a reasonable approximation of the relationship between market and book equity for firms with positive balance sheets, but that the linear approximation is inadequate when the data sample includes firms whose balance sheets show a low or negative liquidation value. (PDF)
- WP 88-09
- Interurban Comparisons of the Quality of Life
- A methodology is developed for constructing quality-of-life comparisons for metropolitan areas in which the full bundle of an area’s attributes is valued, rather than the typical method of focusing on individual characteristics. (PDF)
- WP 88-08
- Financial Structure and the Adjustment of Capital Stock
- An analysis of the corporate investment decision when financial structure has real effects, utilizing data for the U.S. manufacturing sector from 1954 to 1980. (PDF)
- WP 88-07
- Testing for Speculative Bubbles in Stock Prices
- A modification of Kenneth West’s method for investigating speculative bubbles in stock prices, in which a direct test of the "no bubble" hypothesis is applied to long-term annual U.S. stock-market data. (PDF)
- WP 88-06
- Capital Requirements and Optimal Bank Portfolios: a Reexamination
- An examination of the impact of increased capital requirements on bank portfolio behavior, finding that although the variance of earnings and the incentive to increase leverage are reduced with risk- and leverage-related interest rates, the impact of increased capital requirements on portfolio behavior is generally ambiguous. (PDF)
- WP 88-05
- Lessons of the Past and Prospects for the Future in Lender of Last Resort Theory
- A history of the changes in the theory of the role of the lender of last resort--as a source of solvency versus liquidity support--and a discussion of the distinction between necessity and convenience (the American and European versions of lender of last resort theory) in mounting rescue operations through the central bank. (PDF)
- WP 88-04
- TFP Growth, Change in Efficiency, and Technological Progress in the U.S. Airline Industry: 1970 to 1981
- An overview of the airline industry’s early adaptations to deregulation using a best-practice cost function approach; measures cost efficiency and changes in total factor productivity growth for airlines in the 1970s and early 1980s and discusses how these findings relate to individual airline performance. (PDF)
- WP 88-03
- The Impact of Firm Characteristics on Plant Closing Decisions
- An examination of the plant-closing decisions of integrated steel firms in the United States from 1977-1987 to determine whether firm characteristics influenced either the probability or the timing of a plant’s closing during this decade of significant industry contraction. (PDF)
- WP 88-02
- Sources of Wage Dispersion: The Contribution of Interemployer Differentials within Industry
- An analysis of variance in individual production workers’ wages within and between establishments, using BLS Industry Wage Surveys to examine establishment-based wage differentials. (PDF)
- WP 88-01
- Tobin’s Q, Investment, and the Endogenous Adjustment of Financial Structure
- An analysis of a q model of investment in which financial structure affects firm value, using a perfect foresight model of general equilibrium that includes a debt-related agency cost; uses the comparative statics and dynamics of changing the corporate tax rate as an illustration. (PDF)