Is there a "credit channel" for monetary policy?

Monetary policy

Social Security and Household Portfolio Allocation

The entitlement to social security retirement benefits is a major component of aggregate household wealth. This paper focuses on the impact of social security annuities on household portfolio allocation, extending existing optimizing models of portfolio allocation to explicitly consider the role of social security. The model is implemented using cross-section data. The partial equilibrium impacts of changes in social security benefits on portfolio choice and composition are small but precisely measured. The general equilibrium impacts on asset markets of a social security policy change (focusing onlinks between social security and dynamic wealth accumulation and between social security benefits and private pension benefits) are generally much larger.

The rise of offshoring : it's not wine for cloth anymore : general discussion

Productivity

Patterns of international capital flows and their implications for economic development : general discussion

Capital ; Economic development

Reconstruction of the Part Vegetation on the Headwaters of the Piney Creek Watershed in Houston and Trinity Counties, Texas

The National Forests and Grasslands of Texas began a project in 1994 for ecosystem management involving multiple disciplines in an holistic approach to resource inventories. We first began with an intensive archival study of the forest acquisition files and the General Land Office (GLO) files in an effort to identify the western limits of the longleaf pine at the time of initial Anglo-American settlement ca. 1850. Vegetation information was gleaned from this work along with an understanding of the historical occupation of the area, aided by plotting this information onto USGS 7.5\u27 maps overlain by the historic Tobin landownership maps. We have since narrowed our focus from the mosaic of a broad area, to the headwaters of the Piney Creek watershed, an area rich in prehistory and history. Archeological survey has provided data for prehistoric occupations dating to the Early Ceramic period (ca. A.D. 500). More recent deed records, and subsequent landline surveys, have data on witness trees in the 1830s, 1860s, and 1890s, and then again after the Forest Service acquired the land in the 1930s, offering an opportunity to study specie composition over a 100 year period. This study on specie composition, tree density, and basal area, provides preliminary indications that fire suppression in the historic period significantly altered the forest composition

The Effect of the Tax Reform Act of 1986 on the Location of Assets in Financial Services Firms

This paper examines the effects of the Tax Reform Act of 1986 on the international location decisions of U.S. financial services firms. The Act included rule changes that made it substantially more difficult for U.S. firms to defer U.S. taxes on overseas financial services income held in low-tax jurisdictions. These same rule changes were not applied to other forms of income; in particular, income generated from active manufacturing operations was still eligible for deferral after the Act. We use information from the tax returns of U.S. corporations to examine how local taxes affect the allocation of assets held abroad. We find that, before the Act, the location of assets in financial subsidiaries was responsive to differences in host country tax rates across jurisdictions. However, after the Act, differences in host country tax rates no longer explain the distribution of assets held in financial services subsidiaries abroad. In contrast, we find that assets held in manufacturing subsidiaries have become more sensitive to variations in tax rates. Our results suggest that the tightening of the anti-deferral provisions applicable to financial services companies has been successful in neutralizing the effect of host country income taxes on investment location decisions.

Benefits of Control, Managerial Ownership, and the Stock Returns of Acquiring Firms

This paper examines the effect of the benefits of corporate control to managers on the relationship between managerial ownership and the stock returns of acquiring firms in corporate control transactions. At low levels of managerial ownership, agency costs of equity (such as perquisite consumption) reduce the returns earned by acquirers. As the managerial stake in the acquiring firm increases, the interests of managers are more closely aligned with those of shareholders, reducing the acquisition premium. At sufficiently high levels of managerial ownership, managers value a reduction in the risk of their nondiversified financial portfolio. However, managers enjoy nonassignable private benefits of control at high levels of ownership which they are not willing to lose by selling their stake in the financial markets. These benefits of control are increasing in the managerial ownership stake and can lead to managers 'overpaying' even when they own a substantial fraction of the firm. Examining mergers that occurred during 1985 to 1991, we find evidence of such a nonmonotonic relationship between the stock returns earned by acquirers and their managerial ownership level. Further, we find that acquiring firms with high levels of managerial ownership tend to diversify more than acquiring firms with low levels of managerial ownership.