Specialty Conference

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Specialty Conference

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Jan 2017

After financial crises, GDP is typically persistently weak compared to pre-crisis trends. We build a simple competitive general equilibrium model to highlight role that the financial sector may have in boosting GDP to unsustainable, undesirable levels before financial crises. Allowing banks to freel...
Keywords: financial crises, GDP, trade, Loans, time-series
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Specialty Conference

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Specialty Conference

|

Jan 2017

We analyze how two types of recently used prudential policies affected the supply of credit in the United States. First, we test whether the U.S. bank stress tests had any impact on the supply of mortgage credit. We find that initiation of the Comprehensive Capital Analysis and Review (CCAR) stress ...
Keywords: Bank stress tests, Jumbo mortgages, Leveraged lending, Macroprudential Policy, Syndicated loan market
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Senior Fellows/Fellows

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Senior Fellows/Fellows

We argue, from an extensive literature review, that in the vast majority of research settings, biases in alternative expected-return proxies (ERPs) are irrelevant. Therefore, in most settings, the choice between alternative ERPs should be based on an evaluation of their relative measurement-error va...
Keywords: Expected-Return Proxies, finance, implied cost of capital, time-series
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Senior Fellows/Fellows

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Senior Fellows/Fellows

We examine whether anticipation of a repatriation tax reduction affects the amount of cash U.S. multinational corporations (MNCs) hold overseas. We find that U.S. MNCs most likely to benefit from a repatriation tax reduction accumulated significant cash holdings once Congress proposed legislation, a...
Keywords: Multinational corporate taxation, Repatriation, Foreign cash
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Senior Fellows/Fellows

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Senior Fellows/Fellows

International equity mutual funds that hire managers from a country linked to the fund`s geographic mandate exhibit a strong bias to invest in stocks of that country. These funds with “home-biased managers” attract disproportionally more flows, on average, that intensify during periods of higher...
Keywords: international mutual funds, home-bias, information endowment, performance
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