A Federal Reserve System Conference on Research in Applied Microeconomics

By Garrett, Thomas A. | Federal Reserve Bank of St. Louis Review, November-December 2011 | Go to article overview

A Federal Reserve System Conference on Research in Applied Microeconomics


Garrett, Thomas A., Federal Reserve Bank of St. Louis Review


This article summarizes some of the papers presented at the System Applied Microeconomics Conference organized and hosted by the Federal Reserve Bank of St. Louis on May 5-6, 2011. This annual conference brings together economists from the Federal Reserve District Banks across the Federal Reserve System and the Federal Reserve Board to present their latest economic research.

Federal Reserve Bank of St. Louis Review, November/December 2011, 93(6), pp. 455-62.

**********

The Federal Reserve Bank of St. Louis hosted the annual System Applied Microeconomics Conference on May 5-6, 2011. The papers presented at the conference, some of which are summarized in this article, showcased research in the areas of public policy, education and human capital, labor markets, and housing and consumer finance during the Great Recession. (1)

ANALYSIS OF PUBLIC POLICY

The first group of papers focused on public policy issues. In "Assessing the Evidence on Neighborhood Effects from Moving to Opportunity," Aliprantis provides a new framework and a robust instrument to estimate neighborhood effects using data from the Moving to Opportunity for Fair Housing (MTO) program. The MTO program, a 10-year research project, combines tenant-based rental subsidies with housing counseling to help poor families move from poor urban areas to less-poor neighborhoods. Aliprantis's framework improves on earlier methods for studying the effects of housing mobility programs by distinguishing between program and neighborhood effect.

In "The Spending and Debt Response to Minimum Wage Hikes," Aaronson, Agarwal, and French explore how minimum wage increases influence spending and debt accumulation by minimum wage earners. They find that (i) both consumer spending and debt accumulation increase after a minimum wage increase and (ii) most spending induced by such an increase goes toward financing durables. The authors' empirical findings are consistent with an augmented buffer-stock model in which households are collateral constrained.

Given the recent decline in aid from state to local governments, in "Designing Formulas for Distributing State Aid Reductions," Zhao and Coyne develop a new formula for allocation of such funds. Their formula improves on other methods because it is based on the underlying fiscal health of local governments rather than commonly used ad hoc measures.

HUMAN CAPITAL

A second group of papers focused on the topic of human capital. In "The Role of Schools in the Production of Achievement," Canon states that previous research has been unable to simultaneously consider the three types of inputs believed to influence student skills: ability, family inputs, and school inputs. Canon uses parents' savings for higher education as a measure of ability in an empirical framework that corrects for the endogeneity of the three inputs. Unlike earlier studies that do not address the simultaneity among the three inputs, Canon presents evidence that school inputs are important for the formation of student skills when controlling for the ability to learn.

In "Economic Literacy and Inflation Expectations: Evidence from a Laboratory Experiment," Burke and Manz present new experimental evidence on heterogeneity in the formation of inflation expectations. They conduct a laboratory experiment in which subjects complete a set of inflation-forecasting exercises in a simulated economic environment. They find that the subjects' demographic characteristics play a small role in the variation of their inflation expectations, but economic literacy plays a large role in explaining the accuracy of inflation forecasts.

In "Financial Literacy and Mortgage Equity Withdrawals," Duca and Kumar examine whether an individual's financial literacy influences the decision to make or not make mortgage equity withdrawals. Their results indicate that the financially literate are 3 to 5 percentage points less likely to withdraw housing equity but that this result does not apply to home equity lines of credit. …

The rest of this article is only available to active members of Questia

Already a member? Log in now.

Notes for this article

Add a new note
If you are trying to select text to create highlights or citations, remember that you must now click or tap on the first word, and then click or tap on the last word.
One moment ...
Default project is now your active project.
Project items

Items saved from this article

This article has been saved
Highlights (0)
Some of your highlights are legacy items.

Highlights saved before July 30, 2012 will not be displayed on their respective source pages.

You can easily re-create the highlights by opening the book page or article, selecting the text, and clicking “Highlight.”

Citations (0)
Some of your citations are legacy items.

Any citation created before July 30, 2012 will labeled as a “Cited page.” New citations will be saved as cited passages, pages or articles.

We also added the ability to view new citations from your projects or the book or article where you created them.

Notes (0)
Bookmarks (0)

You have no saved items from this article

Project items include:
  • Saved book/article
  • Highlights
  • Quotes/citations
  • Notes
  • Bookmarks
Notes
Cite this article

Cited article

Style
Citations are available only to our active members.
Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

(Einhorn, 1992, p. 25)

(Einhorn 25)

1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

Cited article

A Federal Reserve System Conference on Research in Applied Microeconomics
Settings

Settings

Typeface
Text size Smaller Larger Reset View mode
Search within

Search within this article

Look up

Look up a word

  • Dictionary
  • Thesaurus
Please submit a word or phrase above.
Print this page

Print this page

Why can't I print more than one page at a time?

Help
Full screen

matching results for page

    Questia reader help

    How to highlight and cite specific passages

    1. Click or tap the first word you want to select.
    2. Click or tap the last word you want to select, and you’ll see everything in between get selected.
    3. You’ll then get a menu of options like creating a highlight or a citation from that passage of text.

    OK, got it!

    Cited passage

    Style
    Citations are available only to our active members.
    Buy instant access to cite pages or passages in MLA, APA and Chicago citation styles.

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn, 1992, p. 25).

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences." (Einhorn 25)

    "Portraying himself as an honest, ordinary person helped Lincoln identify with his audiences."1

    1. Lois J. Einhorn, Abraham Lincoln, the Orator: Penetrating the Lincoln Legend (Westport, CT: Greenwood Press, 1992), 25, http://www.questia.com/read/27419298.

    Cited passage

    Thanks for trying Questia!

    Please continue trying out our research tools, but please note, full functionality is available only to our active members.

    Your work will be lost once you leave this Web page.

    Buy instant access to save your work.

    Already a member? Log in now.

    Author Advanced search

    Oops!

    An unknown error has occurred. Please click the button below to reload the page. If the problem persists, please try again in a little while.