Money
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- 13 Nov 2017
- Research & Ideas
Want to Be Happier? Spend Some Money on Avoiding Household Chores
In an age of time scarcity, buying our way out of the negative moments in the day is an important key to happiness, according to research by Ashley V. Whillans, Michael I. Norton, Elizabeth W. Dunn, Paul Smeets, and Rene Bekkers. Open for comment; Comment(s) posted.
- 08 Aug 2016
- Working Paper Summaries
The Unintended Consequences of the Zero Lower Bound Policy
In the aftermath of the financial crisis of 2007-2008, the United States Federal Reserve took an unprecedented decision to lower short-term nominal interest rates to zero, a policy commonly known as zero lower bound policy. This study shows that the policy adversely affected an important part of the shadow banking system, money market funds, whose returns are linked to the Fed funds rate. During times of unusually low interest rates, fund managers tended to increase their portfolios’ risk. The policy also triggered a reduction in capital supply to financial firms and large corporations and increased the financial markets’ exposure to costly runs and defaults.
Does Our Bias Against Federal Deficits Need Rethinking?
Not everyone thinks federal budget deficits are bad. Say hello to Modern Monetary Theory, where red ink primes the economic engine and underwrites social good. Or does it? asks James Heskett. Open for comment; Comment(s) posted.