This paper provides a comprehensive study of the interplay between the Federal Reserve's balance sheet and overnight interest rates. We model both the supply of and the demand for excess reserves, treating assets of the Federal Reserve as policy tools, and estimate the effects of conventional...

In this paper we assemble a measure of international relative prices to gauge the average amount by which prices in China and the USA differ from the prices of their trading partners. Our estimated weighted average of relative prices for China and the USA are the first to use the significantly...

A standard result from static economic theory is that a monopolist with zero cost will maximize profits by charging the price at which the demand has unit elasticity. Yet, the demand for petroleum, as seen by consumers, is price inelastic, and empirical estimates of the price elasticity for...

This paper proposes a tripartite framework of design, evaluation, and post-evaluation analysis for generating and interpreting economic forecasts. This framework?s value is illustrated by re-examining mean square forecast errors from dynamic models and nonlinearity biases from empirical...

The persistence of large trade and budget imbalances has led to increasing demands for protectionist policies. Despite a substantial theoretical literature there appears to be no empirical literature on the use of tariffs as a macroeconomic policy instrument. This paper fills that gap, using the...

This paper estimates income and price elasticities for bilateral world trade. In addition to testing the properties of the error terms, the dynamic specification, and the assumption of parameter constancy, the analysis presents the first application of the Bank Spectrum estimator to bilateral...