Working Papers Bank Financing of Global Supply Chains https://www.atlantafed.org/research/publications/wp/2025/05/19/04-bank-financing-of-global-supply-chains?item=66ed0d20-ddb0-4210-81b5-fdccbec70ff2 66ed0d20-ddb0-4210-81b5-fdccbec70ff2 Monday, 19 May 2025 10:0:0 EST Laura Alfaro, Mariya Brussevich, Camelia Minoiu, and Andrea PresbiteroWorking Paper 2025-4May 2025Examining the role of banks in the reconfiguration of supply chains after the 2018–19 US-China tariffs, the authors show that importers of tariff-hit products were more likely to find new suppliers in other Asian countries if they had a relationship with an Asian-trade finance specialized bank. Screen More, Sell Later: Screening and Dynamic Signaling in the Mortgage Market https://www.atlantafed.org/research/publications/wp/2025/04/14/03-screen-more-sell-later-screening-and-dynamic-signaling-in-mortgage-market?item=9b8280c1-c58c-4ccd-9178-337da06142bc 9b8280c1-c58c-4ccd-9178-337da06142bc Monday, 14 Apr 2025 10:0:0 EST Manuel Adelino, Bin Wei, and Feng ZhaoWorking Paper 2025-3April 2025Exploring the relationship between screening effort and signaling in the mortgage market, the authors produce research suggesting that a higher screening effort corresponds with more signaling in the market, particularly through delayed sales. Economic Diversity and the Resilience of Cities https://www.atlantafed.org/research/publications/wp/2025/03/24/02-economic-diversity-and-resilience-of-cities?item=be8e5aaf-6cc5-48fb-8506-a0ba729d91fc be8e5aaf-6cc5-48fb-8506-a0ba729d91fc Monday, 24 Mar 2025 10:0:0 EST François de Soyres, Simon Fuchs, Illenin O. Kondo, and Helene MaghinWorking Paper 2025-2March 2025Are cities with a broader mix of sectors and occupations more resilient? Analysis of data across occupations, industries, and cities in France reveals that local economic diversity provides workers with valuable insurance. The authors propose a framework to quantify this "insurance value" of economic diversity. Foundational Processes and Growth https://www.atlantafed.org/research/publications/wp/2025/02/19/01--foundational-processes-and-growth?item=5fc64a7d-9174-4414-972b-7122821c0e47 5fc64a7d-9174-4414-972b-7122821c0e47 Wednesday, 19 Feb 2025 10:0:0 EST Wing Wah Tham, Salomé Baslandze, Elvira Sojli, and Leo LiuWorking Paper 2025-1February 2025Analyzing texts of millions of patents, the authors study the interaction between process and product innovations and their distinct role in firm growth dynamics. The innovation model demonstrates that foundational processes drive sustained firm growth, especially via subsequent product creation. The Macroeconomics of Irreversibility https://www.atlantafed.org/research/publications/wp/2024/12/23/17--macroeconomics-of-irreversibility?item=535fb6ae-e2e5-4e06-a155-f907d8d1a594 535fb6ae-e2e5-4e06-a155-f907d8d1a594 Monday, 23 Dec 2024 10:0:0 EST Isaac Baley and Andrés BlancoWorking Paper 2024-17December 2024The authors construct a framework to understand the effects that partial irreversibility in investment has on the economy. Among other things, they find that irreversibility implies that investment responds rather sluggishly to shocks, which is consistent with the data. Trade Uncertainty and U.S. Bank Lending https://www.atlantafed.org/research/publications/wp/2024/10/18/16--trade-uncertainty-and-us-bank-lending?item=175c3fb7-f268-478b-9190-e336e42ccce1 175c3fb7-f268-478b-9190-e336e42ccce1 Friday, 18 Oct 2024 10:0:0 EST Ricardo Correa, Julian di Giovanni, Linda S. Goldberg, and Camelia MinoiuWorking Paper 2024-16aOctober 2024 (Revised February 2025)Studying the effects of trade uncertainty on domestic credit supply, the authors find that increased uncertainty is associated with a broad lending contraction across banks' customer firms. They also find that the lending contraction is larger for more capital-constrained banks and has significant real effects. Mortgage Lock-in, Lifecycle Migration, and the Welfare Effects of Housing Market Liquidity https://www.atlantafed.org/research/publications/wp/2024/10/15/15--mortgage-lock-in-lifecycle-migration-and-welfare-effects-of-housing-market-liquidity?item=6d817a39-9893-4e95-83db-7de7cc0900cf 6d817a39-9893-4e95-83db-7de7cc0900cf Tuesday, 15 Oct 2024 10:0:0 EST Kristopher Gerardi, Franklin Qian, and David ZhangWorking Paper 2024-15October 2024Examining the effects of housing market illiquidity due to mortgage lock-in, the authors find that younger home buyers are disproportionately affected by mortgage lock-in, which disrupts their typical pattern of moving to higher-quality neighborhoods. Stimulus through Insurance: The Marginal Propensity to Repay Debt https://www.atlantafed.org/research/publications/wp/2024/09/23/14--stimulus-through-insurance--marginal-propensity-to-repay-debt?item=f42dbbcd-26d6-46b5-acce-73210747f547 f42dbbcd-26d6-46b5-acce-73210747f547 Monday, 23 Sep 2024 10:0:0 EST Gizem Kosar, Davide Melcangi, Laura Pilossoph, and David WiczerWorking Paper 2024-14September 2024Using the Survey of Consumer Expectations, the authors show that households with more debt or lower net wealth are likelier to use additional income to repay debt. By paying down debt, these households save on debt service payments, seeing a larger overall gain. Firm Exit and Liquidity: Evidence from the Great Recession https://www.atlantafed.org/research/publications/wp/2024/09/23/13--firm-exit-and-liquidity--evidence-from-great-recession?item=7bb17c65-9ac0-4fc1-96e6-18d0ce94a03b 7bb17c65-9ac0-4fc1-96e6-18d0ce94a03b Monday, 23 Sep 2024 9:30:0 EST Fernando Leibovici and David WiczerWorking Paper 2024-13September 2024The authors introduce evidence from the Great Recession that the firms most likely to shut down were those in financial distress, and once that factor has been accounted for age, size, and productivity are relatively unimportant. The Inflation Accelerator https://www.atlantafed.org/research/publications/wp/2024/09/23/12--inflation-accelerator?item=29b673c0-67f8-4819-865f-b6682bcbb160 29b673c0-67f8-4819-865f-b6682bcbb160 Monday, 23 Sep 2024 9:0:0 EST Andrés Blanco, Corina Boar, Callum Jones, and Virgiliu MidriganWorking Paper 2024-12September 2024 The authors develop a tractable sticky price model in which the fraction of price changes evolves endogenously over time and increases with inflation. Their model features an inflation accelerator that significantly increases the slope of the Phillips curve during high-inflation periods. Nonlinear Dynamics in Menu Cost Economies? Evidence from U.S. Data https://www.atlantafed.org/research/publications/wp/2024/09/23/11--nonlinear-dynamics-in-menu-cost-economies--evidence-from-us-data?item=236b5384-9fc6-42b5-a246-7b6436b84426 236b5384-9fc6-42b5-a246-7b6436b84426 Monday, 23 Sep 2024 8:30:0 EST Andrés Blanco, Corina Boar, Callum Jones, and Virgiliu MidriganWorking Paper 2024-11September 2024 The authors show that standard menu cost models cannot simultaneously reproduce the dispersion in the size of micro-price changes and the extent to which the fraction of price changes increases with inflation in the US time-series. Nonlinear Inflation Dynamics in Menu Cost Economies https://www.atlantafed.org/research/publications/wp/2024/09/23/10--nonlinear-inflation-dynamics-in-menu-cost-economies?item=7da4f607-741c-4528-8658-caeb8c3ebe80 7da4f607-741c-4528-8658-caeb8c3ebe80 Monday, 23 Sep 2024 8:0:0 EST Andrés Blanco, Corina Boar, Callum Jones, and Virgiliu MidriganWorking Paper 2024-10September 2024 Using a multi-product menu cost model, the authors reproduce the extent to which the fraction of price changes increases with inflation. In contrast to existing models, the fraction of price changes increases rapidly with the size of monetary shocks, so their model implies a nonlinear Phillips curve. The Dynamics of Large Inflation Surges https://www.atlantafed.org/research/publications/wp/2024/09/23/09--dynamics-of-large-inflation-surges?item=0d34f29d-00c3-40d0-838b-c46a4dab7e9b 0d34f29d-00c3-40d0-838b-c46a4dab7e9b Monday, 23 Sep 2024 7:30:0 EST Andrés Blanco, Pablo Ottonello, and Tereza RanošováWorking Paper 2024-9September 2024 Characterizing episodes of large inflation surges that have been observed worldwide in the last three decades, the authors show that episodes of large and persistent inflation tend to occur with government responses that depart from the prescriptions of textbook policy rules. Quantifying Forward Guidance and Yield Curve Control https://www.atlantafed.org/research/publications/wp/2024/09/23/08--quantifying-forward-guidance-and-yield-curve-control?item=3353592e-1349-4840-92b7-c4665360c3d7 3353592e-1349-4840-92b7-c4665360c3d7 Monday, 23 Sep 2024 7:0:0 EST Junko Koeda and Bin WeiWorking Paper 2024-8September 2024 Evaluating the impact of the Bank of Japan's outcome-based forward guidance and yield curve control, the authors show that these policies have not only had a significant impact on the shadow rate, but they have also been effective in raising output and inflation. Zombie Lending to U.S. Firms https://www.atlantafed.org/research/publications/wp/2024/08/15/07--zombie-lending-to-us-firms?item=aaa65ce2-8565-4408-85f8-3c3eeae3daad aaa65ce2-8565-4408-85f8-3c3eeae3daad Thursday, 15 Aug 2024 10:0:0 EST Giovanni Favara, Camelia Minoiu, and Ander Perez-OriveWorking Paper 2024-7August 2024 The authors show that although U.S. banks don't engage in zombie lending, unregulated financial intermediaries do. However, zombie firms file for bankruptcy at elevated rates, suggesting that nonbanks' zombie lending does not enhance the survival rate of these firms.