November 1989
Federal Reserve Bank of Dallas

Economic Review was published until 1999.

Interstate Banking and the Federal Reserve: A Historical Perspective
Robert T. Clair and Paula K. Tucker

The U.S. banking system is unique in the industrialized world because it lacks nationwide banks. Historically, interstate banking was associated with other issues, such as monopolistic power and excessive political influence. This perception fueled public distaste for national banking. A more positive sentiment has emerged in recent years. Federal Reserve opinion evolved from one of strong opposition to interstate banking to one of acceptance.

Clair and Tucker trace the rise and fall of opposition to interstate banking and explore banking developments during the twentieth century. They concentrate on the evolution of Federal Reserve policy regarding interstate banking. They conclude that policymakers now believe that small, locally owned banks and interstate banks can successfully coexist. They also suggest that continued introduction of interstate banking into the U.W. Banking system will help banks diversify and disperse risk, as well as benefit customers that operate nationally.

The Texas Industrial Production Index
Franklin D. Berger and William T. Long III

The Texas Industrial Production Index (TIPI) measures the output of the manufacturing, mining, and utility sectors of the Texas economy. These sectors are of special interest because of their sensitivity to business cycles and because of the size (albeit declining) of the Texas mining sector. The Federal Reserve Bank of Dallas has published TIPI since 1958. Revisions are implemented when new data sources are available, when existing data are revised, or when methodological improvements are devised. The most recent major TIPI revision came in the fall of 1988.

Berger and Long examine TIPI's performance during the volatile 1980s and relate this performance to the broader economic environment in which it took place. They find that the Texas industrial sector has grown more slowly than that of the nation since 1982 and that TIPI clearly depicts the oil-price induced 1986–87 Texas recession. They also find that Texas industrial production was buoyed by the manufacturing sector and hindered by mining, although the effects of two periods of drastic oil price declines spilled over to the manufacturinig sector as well.