Research Department Working Papers
A History of U.S. Tariffs: Quantifying Strategic Trade-Offs in Tariff Policy Design
U.S. tariff policy has historically balanced competing goals—revenue, protection and reciprocity. Policy priorities have shifted over time in response to changing economic and political conditions. Using a calibrated general equilibrium model, this paper illustrates these trade-offs through the lens of tariff Laffer curves.
August 05, 2025
Research Department Working Papers
The Micro and Macro Dynamics of Capital Flows
This paper studies empirically and theoretically the effects of international financial flows on resource allocation.
August 01, 2025
China remains modest player in U.S.–Mexico trade despite growing scrutiny
Understanding Mexico’s evolving economic linkages with East Asia and China is critical to the future of the United States–Mexico–Canada Agreement (USMCA trade accord) and the nearshoring and integration of North American manufacturing supply chains.
July 09, 2025
U.S. tariff outcomes dependent on trading partner responses
In Depth: U.S. tariff policy has historically shifted among competing goals: providing revenue, protecting domestic markets and opening foreign markets to domestic producers. These goals are unlikely to be achieved simultaneously.
May 13, 2025
Research Department Working Papers
Tempting FAIT: Flexible Average Inflation Targeting and the Post-COVID U.S. Inflation Surge
In August 2020, the Federal Reserve replaced Flexible Inflation Targeting (FIT) with Flexible Average Inflation Targeting (FAIT), introducing make-up strategies that allow inflation to temporarily exceed the 2% target. Using a synthetic control approach, this paper estimates that FAIT raised CPI inflation by about 1 percentage point and core CPI inflation by 0.5 percentage points, suggesting a moderate impact net of food and energy and a largely temporary effect. The findings are consistent with the hypothesis of a steeper-than-expected post-pandemic Phillips curve in the New Keynesian model.
April 09, 2025
Globalization Institute Working Paper
Living Up to Expectations: The Effectiveness of Forward Guidance and Inflation Dynamics Post-Global Financial Crisis
This paper studies the effectiveness of forward guidance when central banks face private agents with heterogeneous expectations allowing for a degree of bounded rationality.
April 03, 2025
Weighing Texas economic resilience amid tariffs, workforce challenges
Ray Perryman, principal of Waco-based The Perryman Group, has been an observer of the Texas economy for more than four decades. He offers his views of what has propelled Texas since the 1980s oil bust and the state’s future prospects, and he recounts how he grew his economics firm.
March 07, 2025
Research Department Working Papers
Trade Costs and Inflation Dynamics
Using bilateral trade flows from detailed global input-output data and a gravity framework, this paper estimates trade cost shocks and their effects on CPI inflation.
March 04, 2025
Mexico, U.S. and China offer an evolving ‘triangular’ trade relationship
Enrique Dussel Peters, a professor at the Graduate School of Economics at the Universidad Nacional Autonóma de México and coordinator of the university’s Center for Chinese–Mexican Studies, discusses trade flows between the U.S., Mexico and China and their prospects.
March 03, 2025
Speech by President Lorie K. Logan
Efficient and effective central bank balance sheets
At a Bank of England conference on central bank balance sheets, President Lorie Logan laid out two key principles: efficient and effective. It’s heartening that central banks around the world have converged on some approaches to uphold these twin principles.
February 25, 2025