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Press Releases

October 2009

Featuring research published in September 2009


Federal Reserve Independence in a Global Context
September 10, 2009
Dennis P. Lockhart, president and chief executive officer of the Federal Reserve Bank of Atlanta, comments on the U.S. and global economy, assesses the nationâ??s policy challenges, and connects this analysis to the issue of central bank independence to the World Affairs Council of Jacksonville, in Jacksonville, Fla.

Thinking About Recovery
September 30, 2009
Dennis P. Lockhart, president and chief executive officer of the Federal Reserve Bank of Atlanta, comments on the recovery and how to weigh vulnerabilities and risks to the University of South Alabama's Mitchell College of Business Center for Real Estate Studies Coastal Economic Outlook, in Mobile, Ala.


Sector-Specific Human Capital and the Distribution of Earnings
Working Paper 2009-21
Examining how assignment frictions and specialization affect human capital acquisition, aggregate output, and distribution of income, the author finds that training, output, and specialization increase as the extent of the market increases.

Wage Dispersion and Wage Dynamics within and across Firms
Working Paper 2009-22
Studying labor turnover and wage mobility, the authors demonstrate that observed inconsistencies may stem from the underlying specification of search frictions rather than from the general search approach.

Cointegrated TFP Processes and International Business Cycles
Working Paper 2009-23
Real exchange rates are highly volatile. The authors use an international real business cycle model with cointegrated total factor productivity shocks to explain this high volatility.

Overborrowing and Systemic Externalities in the Business Cycle
Working Paper 2009-24
Credit constraints that link a private agentâ??s debt to market-determined prices can lead to overborrowing. The authors quantify the effects of this inefficiency, finding that it can increase the probability and the severity of a financial crisis.

Decomposing the Foreclosure Crisis: House Price Depreciation versus Bad Underwriting
Working Paper 2009-25
Using data from Massachusetts between 1989 and 2008, the authors estimate the sensitivity of foreclosures to house price movements. The current foreclosure crisis was primarily driven by the severe decline in housing prices that began in 2005, they find.


Inflation and Monetary Regimes
Working Paper 2009-26
Why does the correlation of inflation and money growth increase when data are averaged over longer periods and higher-inflation countries are included? The authors show that inflation persistence is the answer.

Regional Economics

On the Bubble: When Real Estateâ??s Long Haul Took a Shortcut
EconSouth, Q3 2009
While home prices kept appreciating handsomely, homeowners thought they were on a surefire path to personal wealth. The market swoon brought a sobering realization: What goes up can come down.

Vacancy Signs Dot Lodging Landscape
EconSouth, Q3 2009
The effects of the recession have finally caught up with the U.S. lodging industry. Leisure and business travel have fallen off as consumers and businesses tighten their purse strings. Hoteliers are trying to find creative ways to draw in customers and are waiting for a turn in the economic tide to bring travelers flooding back.

Sports Still Draw Fans Despite Recession
EconSouth, Q3 2009
In sports, nothing succeeds like success. Buoyed by fan loyalty, teams at larger colleges and pro levels have mostly thrived despite the challenging economic climate. Smaller teams, though, are feeling the brunt of the down economy.

Is More Still Better? Revisiting the Sixth District Coincident Indicator
Economic Review, No. 3, 2009
A revised version of the D6 Factor model of the southeastern economy is better than the original at describing contemporary economic activity and allows for historical comparisons across several business cycles.


Thinking About Recovery (MP3 20:05)
Dennis P. Lockhart, president and chief executive officer of the Federal Reserve Bank of Atlanta, speaks at the Coastal Economy Outlook conference in Mobile, Alabama.

Indexing the Housing Market (MP3 14:57)
EconSouth Now
Karl Case, an economics professor at Wellesley College and codeveloper of the S&P/Case-Shiller Home Price Index, discusses house prices and the state of the housing market.

Land Banking as a Foreclosure Mitigation Strategy (MP3 15:47)
Foreclosure Response
Frank Alexander, professor of law at Emory Law School, discusses the issues and opportunities that land banking represents for stabilizing communities across the country.