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    <title>EconStor Collection: Public Policy Discussion Papers, Boston Fed</title>
    <link>http://hdl.handle.net/10419/266</link>
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      <title>Interstate Fiscal Disparity in State Fiscal Year 1999</title>
      <link>http://hdl.handle.net/10419/23455</link>
      <description>Title: Interstate Fiscal Disparity in State Fiscal Year 1999
&lt;br/&gt;
&lt;br/&gt;Authors: Tannenwald, Robert; Turner, Nicholas
&lt;br/&gt;
&lt;br/&gt;Abstract: This paper compares states in terms of their relative fiscal capacity, fiscal need, fiscal comfort, and tax effort in state fiscal year 1999 (FY1999). It is the most recent in a series initiated by the U.S. Advisory Commission on Intergovernmental Relations (ACIR) in 1962. As in previous studies, the authors use the representative tax system and representative expenditure system methodologies in their analysis. Compared with FY1997, the authors find less interstate disparity in fiscal capacity, fiscal need, and fiscal comfort. However, such disparity, though diminished, remains substantial. The New England and Mid-Atlantic regions remain the most ?fiscally comfortable,? while the East South Central and West South Central regions are still the most ?fiscally stressed.?</description>
      <pubDate>Wed, 29 Oct 2003 22:58:59 GMT</pubDate>
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    <item>
      <title>Social Security and Unsecured Debt</title>
      <link>http://hdl.handle.net/10419/23456</link>
      <description>Title: Social Security and Unsecured Debt
&lt;br/&gt;
&lt;br/&gt;Authors: Hurst, Erik; Willen, Paul
&lt;br/&gt;
&lt;br/&gt;Abstract: Most young households simultaneously hold both unsecured debt on which they pay an average of 10 percent interest and social security wealth on which they earn less than 2 percent. We document this fact using data from the Panel Study of Income Dynamics. We then consider a life-cycle model with ?tempted? households, who find it impossible to commit to an optimal consumption plan and ?disciplined? households who have no such problem, and we explore ways to reduce this inefficiency. We show that allowing households to use social security wealth to pay off debt while exempting young households from social security contributions (but in both cases requiring higher contributions later) leads to increases in welfare for both types of households and, for disciplined households, to significant increases in consumption and saving and reductions in debt.</description>
      <pubDate>Wed, 29 Oct 2003 22:58:59 GMT</pubDate>
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      <title>Is Poland the Next Spain?</title>
      <link>http://hdl.handle.net/10419/23454</link>
      <description>Title: Is Poland the Next Spain?
&lt;br/&gt;
&lt;br/&gt;Authors: Caselli, Francesco; Tenreyro, Silvana
&lt;br/&gt;
&lt;br/&gt;Abstract: The authors revisit Western Europe?s record with labor ?productivity convergence and tentatively extrapolate its implications for the future path of Eastern Europe. The poorer Western European countries caught up with the richer ones through both higher rates of physical capital accumulation and greater total factor productivity (TFP) gains. These (relatively) high rates of capital accumulation and TFP growth reflect convergence along two margins. One margin (between industries) is a massive reallocation of labor from agriculture to manufacturing and services, which have higher capital intensity and use resources more efficiently. The other margin (within industries) reflects capital deepening and technology catch-up at the industry level. In Eastern Europe the employment share of agriculture is typically quite large, and agriculture is particularly unproductive. Hence, there are potential gains from sectoral reallocation. However, the between-industry component of the East?s income gap is quite small. Hence, the East seems to have only one real margin to exploit: the within-industry one. Coupled with the fact that within-industry productivity gaps are enormous, this suggests that convergence will take a long time. On the positive side, however, Eastern Europe already has levels of human capital similar to those of Western Europe. This is good news because human capital gaps have proved very persistent in Western Europe?s experience. Hence, Eastern Europe does start out without the handicap that is harder to overcome.</description>
      <pubDate>Wed, 29 Oct 2003 22:58:59 GMT</pubDate>
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    <item>
      <title>Financial Development, Financial Constraints, and the Volatility of Industrial Output</title>
      <link>http://hdl.handle.net/10419/23452</link>
      <description>Title: Financial Development, Financial Constraints, and the Volatility of Industrial Output
&lt;br/&gt;
&lt;br/&gt;Authors: Larrain, Borja
&lt;br/&gt;
&lt;br/&gt;Abstract: More financially developed countries show lower volatility of industrial output. Volatility is particularly reduced in industries that are more financially dependent. Most of the reduction is in idiosyncratic volatility. Systematic volatility is reduced less strongly, implying that industries are more closely correlated with GDP in more financially developed countries. At the firm level, short-term debt is negatively correlated with output as financial development increases, suggesting that debt is used in a countercyclical way to stabilize production. The results indicate that financial development relaxes financial constraints mainly to smooth negative cashflow shocks.</description>
      <pubDate>Wed, 29 Oct 2003 22:58:59 GMT</pubDate>
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