I’ve been the Managing Editor of the Journal of Financial Views for the reason that first subject in Summer time 1987. The JEP is revealed by the American Financial Affiliation, which determined again in 2011–to my delight–that the journal can be freely obtainable on-line, from the present subject all the best way again to the primary subject. You may obtain particular person articles or total points, and it’s obtainable in varied e-reader codecs, too. Right here, I’ll begin with the Desk of Contents for the just-released Summer time 2025 subject, which within the Taylor family is named subject #153. Beneath which can be abstracts and direct hyperlinks for all the papers. I plan to weblog extra particularly about a few of the papers within the few weeks, as effectively.
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Symposium on Housing Markets
“How Regional Inequality and Migration Drive Housing Prices and Rents,” by Greg Howard and Jack Liebersohn
We argue that rising regional inequality contributes to larger common housing costs and rents. We present three key empirical information that contribute to this mechanism: first, revenue progress has been sooner in already high-income cities; second, individuals are drawn to those cities by the revenue progress, elevating relative housing demand and relative housing costs and rents; and third, housing provide in these cities is inelastic as a result of density and regulation, so these cities haven’t produced the housing to match the rising demand. We illustrate the ensuing adjustments utilizing a graphical spatial mannequin by which rising regional inequality reallocates inhabitants towards high-income, supply-constrained areas. This shift raises nationwide common housing costs and rents.
“Curbing Rising Housing Costs: A Model-Based Policy Comparison,” by Boaz Abramson and Tim Landvoigt
Current a long time have seen home costs develop strongly relative to incomes, making housing ever much less inexpensive. We develop and quantify a mannequin of segmented housing markets to check the drivers of rising housing prices and to judge insurance policies geared toward curbing these prices. We present that rising wealth dispersion, along with stagnating housing provide, can clarify the noticed enhance in housing prices. Demand-side insurance policies comparable to down fee help and mortgage curiosity deductions inadvertently trigger upward stress on home costs and exacerbate unaffordability. Provide-side insurance policies comparable to tax credit for growth or development of inexpensive housing decrease home costs by growing the housing inventory. Which kind of recent housing is constructed issues: new development within the high-end segments improves affordability by extra in all segments of the housing market in comparison with new development in bottom-end segments.
“The Folk Economics of Housing,” by Christopher S. Elmendorf, Clayton Nall, and Stan Oklobdzija
Why is housing provide so severely restricted in US cities and suburbs? City economists supply two main hypotheses: house owner self-interest and political fragmentation. Owners, who outnumber and have organizational benefits over renters, are stated to foyer in opposition to growth to guard their property values. The fragmentation speculation emphasizes that growth’s unfavorable externalities are borne regionally whereas many of the advantages accrue regionally or nationally, main localities to dam housing. This paper gives one other clarification: unusual individuals merely don’t consider that including extra housing to the regional inventory would scale back housing costs. Throughout three authentic surveys of city and suburban residents, solely a minority of respondents say that a big, constructive, regional housing provide shock would scale back costs or rents. These beliefs are weakly held and unstable (suggesting individuals have given the problem little thought), however respondents do have steady views about who’s accountable for top housing costs: builders and landlords. Massive, bipartisan supermajorities help worth controls, demand subsidies, and restrictions on putative dangerous actors, insurance policies which they consider can be simpler than provide liberalization for widespread affordability. We focus on the implications of those findings for efforts to broaden the provision of housing.
“Building Costs and House Prices,” by Brian Potter and Chad Syverson
We take an extended, broad, and theoretically agnostic view towards the connection between constructing prices and home costs within the US housing market. We discover that constructing prices have by no means had all that a lot explanatory energy over US housing costs, however even the imperfect correlations of the previous have weakened additional in latest a long time alongside a number of dimensions.
“International Dimensions of Housing Markets,” by Cristian Badarinza and Tarun Ramadorai
We make the case that a world perspective on housing markets may help us perceive why home costs and transactions volumes typically differ in ways in which can’t simply be attributed to native financial elements. We first doc cross-country and cross-time variation in home price-to-income ratios, and selectively focus on a rising literature which quantifies how worldwide capital flows have an effect on home housing markets. Whereas this literature helps rationalize a few of the rhetoric on globalization’s results on housing markets, it appears tough at first look to attribute worth variation on the combination housing market stage to the comparatively small absolute magnitudes of cross-border housing capital flows. We argue utilizing a search and matching framework that housing market frictions can amplify the impact of seemingly modest shocks and result in extra widespread reverberation via the housing market, linking native outcomes to the worldwide distributions of wealth, threat, and productiveness.
Articles
“Interview with Anne O. Krueger,” by Dylan Matthews
Matthews interviews eminent worldwide economist Anne O. Krueger, tracing her life in academia and her service at multilateral financial establishments, and explaining her myriad mental contributions to the sector. Krueger recounts her early skepticism of import substitution, knowledgeable by her experiences in Turkey and India, culminating in her influential 1974 paper on rent-seeking. Krueger discusses her tenure on the World Financial institution within the Eighties and her time on the IMF within the 2000s, the place she influenced the fund’s response to the monetary disaster in Argentina. She additionally explains her career-long curiosity in commerce liberalization efforts, her issues in regards to the decline of the World Commerce Group and multilateral commerce negotiations, and her skepticism about america’ latest flip towards industrial coverage. Krueger ends by reflecting on the evolution of the economics occupation and providing recommendation for younger economists.
“Protecting Antiquities: A Role for Long-Term Leases?” by Michael Kremer and Tom Wilkening
With a purpose to protect cultural patrimony for future generations, most nations ban exports of antiquities. Nonetheless, this may increasingly drive commerce underground, significantly in low-income and low-state capability contexts, and trigger irreversible harm to cultural heritage. We argue that complementing export bans with fixed-duration, long-term leases can strengthen incentives for upkeep and revelation of antiquities, whereas preserving cultural patrimony. Permitting solely leases slightly than gross sales limits potential losses from corrupt offers between international collectors and authorities officers. Standardized contracts with set lease lengths, insurance coverage necessities, and care necessities may additionally be essential to restrict corruption and set up a well-functioning market.
“Basel Endgame: Bank Capital Requirements and the Future of International Standard Setting,” by Stephen Cecchetti, Jeremy Kress, and Kermit Schoenholtz
In 2023, US regulators proposed the “Basel Endgame,” a long-awaited overhaul of financial institution capital necessities. The proposal aimed to deliver america into compliance with worldwide requirements established by the Basel Committee on Banking Supervision in response to the 2008 World Monetary Disaster. Nonetheless, fierce trade opposition to what banks considered as a pricey enhance in capital necessities successfully killed the proposal. On this essay, we describe the aim of financial institution capital and the historical past of worldwide standard-setting in financial institution regulation. We then spotlight an important points of the Basel Endgame, in addition to the arguments for and in opposition to adopting the rule. We present that the talk unnecessarily conflated two distinct questions: (1) whether or not america ought to adjust to worldwide regulatory requirements, and (2) whether or not america ought to increase giant banks’ capital necessities. Whereas there are robust grounds to reply each questions within the affirmative, they needn’t be addressed collectively. That’s, america can implement worldwide requirements in a capital-neutral method to protect international cooperation in financial institution regulation, leaving the separate query of elevating capital necessities for one more day.
“Carbon Rollercoaster: A Historical Analysis of Decarbonization in the United States,” by Karen Clay, Akshaya Jha, Joshua Lewis, and Edson Severnini
This paper paperwork the altering developments in US carbon emissions and discusses the principle elements that contributed to the historic carbon emissions rollercoaster. We divide the dialogue into 4 durations: as much as 1920, 1920–1960, 1960–2005 and after 2005. For every interval, we focus on the principle drivers of nationwide carbon emissions. We then focus on developments in carbon emissions within the electrical energy sector. Electrical energy sector emissions have been initially very small, however would develop into the most important supply of US carbon emissions over the interval 1980–2015, and the most important contributor to decarbonization since 2007. Within the final part, we provide some classes for what creating economies would possibly be taught from the US expertise.
“Text as Data in Economic Analysis,” by Tarek A. Hassan, Stephan Hollander, Aakash Kalyani, Laurence van Lent, Markus Schwedeler, and Ahmed Tahoun
This text discusses how you can apply computational linguistics methods to investigate largely unstructured corporate-generated textual content for financial evaluation. As a core instance, we illustrate how textual evaluation of earnings convention name transcripts can present insights into how markets and particular person companies reply to financial shocks, comparable to a nuclear catastrophe or a geopolitical occasion: insights that always elude conventional non-text information sources. This method allows extracting actionable intelligence, supporting each policy-making and strategic company decision-making. We additionally discover purposes utilizing different sources of corporate-generated textual content, together with patent paperwork and job postings. By incorporating computational linguistics methods into the evaluation of financial shocks, new alternatives come up for real-time financial information, providing a extra nuanced understanding of market and agency responses in instances of financial volatility.
“How Congress Designed the Federal Reserve to Be Independent of Presidential Control,” by Gary Richardson and David W. Wilcox
Typical knowledge traces the origins of the Federal Reserve’s independence to the 1951 Treasury-Fed Accord. That rendition of historical past is inaccurate. The principal supply of the Fed’s monetary-policy independence is the Banking Act of 1935, which created the Fed’s trendy management construction and positioned monetary-policy choices past Presidential management. Congressional intent is evident on this case as a result of the preliminary draft of the invoice vested management of financial coverage with the President. After intensive debate, Congress amended the laws and crafted the institutional options that enshrine the Fed’s independence. The central position of the Banking Act of 1935 means that solely an act of Congress or a Supreme Court docket ruling might basically strengthen presidential affect over financial coverage.
“Recommendations for Further Reading,” by Timothy Taylor
