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Press Releases

Research Notes–April 2009

Featuring research published in March 2009


On Credit, Trade, and Food Stability
March 26, 2009
Dennis P. Lockhart, president and chief executive officer of the Federal Reserve Bank of Atlanta, provides remarks on how problems in credit markets have dampened global trade at the Global Interdependence Center Conference on Food and Water: Basic Challenges to International Stability, in Paris, France.

On Real Estate and Other Risks to the Economic Outlook
March 4, 2009
Dennis P. Lockhart, president and chief executive officer of the Federal Reserve Bank of Atlanta, provides remarks on risks in residential and commercial real estate to the Greater Miami Chamber of Commerce, in Miami, Florida.


Understanding Markov-Switching Rational Expectations Models
Working Paper 2009-5
Developing a set of necessary and sufficient conditions for equilibria to be determinate in a class of Markov-switching rational expectations models, the authors develop an algorithm to check these conditions in practice.

Decomposing Changes in the Aggregate Labor Force Participation Rate
Working Paper 2009-6
The author demonstrates the importance of changes in population shares across demographic groups as a driving force behind changes in the overall labor force participation rate.

Product Market Regulation and Market Work: A Benchmark Analysis
Working Paper 2009-7
Looking at the effect of product market regulations on hours worked, the authors find that these regulations work in effectively the same manner as taxes on labor income or consumption do.

Entry Barriers, Competition, and Technology Adoption
Working Paper 2009-8
What explains the differences in countries’ total factor productivity and thus their per capita income? The author develops a model showing that entry barriers can be an important reason.


The Surprising Use of Credit Scoring in Small Business Lending by Community Banks and the Attendant Effects on Credit Availability and Risk
Working Paper 2009-9
Employing data from a new survey, the authors’ analysis suggests that credit scoring is associated with increased lending to small businesses after a learning period, with no material change in the quality of the portfolio.

Technological Change, Financial Innovation, and Diffusion in Banking
Working Paper 2009-10
While the past quarter century has seen substantial changes in the banking industry, the authors find that little is known about how and why financial innovations are initially developed.

Pricing Model Performance and the Two-Pass Cross-Sectional Regression Methodology
Working Paper 2009-11
The authors provide a systematic treatment of the two-pass cross-sectional regression methodology when a beta pricing model fails to hold exactly. They derive new specification and model comparison tests.

A Note on the Estimation of Asset Pricing Models Using Simple Regression Betas
Working Paper 2009-12
The authors present an asymptotic analysis of the two-pass cross-sectional regression methodology that makes uses of simple regression betas. They show that ignoring model misspecification can often lead to the incorrect conclusion that a risk factor is priced.

Regional Economics

Forest Products Industry Has Deep Southern Roots
EconSouth Q1 2009
With plentiful indigenous resources, the forest products industry has long been an important part of the region’s economy, employing thousands of people and generating billions of dollars. But with a recession and global trade pressures, the industry faces daunting challenges.

Paying for Crime and Punishment
EconSouth Q1 2009
Criminals aren't the only ones who pay for their crimes—so does everyone else, in the form of taxes to build and operate prisons and put police on the streets as well as businesses that charge higher prices to offset shoplifting losses. With a slow economy contributing to a rise in crime, the associated costs may be on the rise.

International Economics

Credit Storm Sinking Global Trade
EconSouth Q1 2009
International trade flourished in the booming global economy. But just as the rising tide of global trade lifted all ships, the worldwide recession has forced some governments to finance the trade that private enterprise had funded in more prosperous times.


The Economic Impact of Crime (MP3 9:35)
EconSouth Now
Dr. Robert R. Friedman, a professor in Georgia State University's Department of Criminal Justice, discusses the economic impact of crime.

Making Sense of the Subprime Crisis (MP3 8:27)
Financial Update Focus
Atlanta Fed economist Kris Gerardi discusses factors that triggered the subprime mortgage crisis, whether it could have been foreseen, and the lessons learned from it.

Explaining the Copenhagen Consensus (MP3 11:57)
Research Insights
Finn Kydland, winner of the 2004 Nobel Prize in economics, discusses his involvement in the Copenhagen Consensus, a blueprint for improving living conditions in the developing world.