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13 posts on "Recession"

September 24, 2014

Developing a Narrative: The Great Recession and Its Aftermath



Third in a five-part series
This series examines the Federal Reserve Bank of New York’s dynamic stochastic general equilibrium (FRBNY DSGE) model—a structural model used by Bank researchers to understand the workings of the U.S. economy and provide economic forecasts. The severe recession experienced by the U.S. economy between December 2007 and June 2009 has given way to a disappointing recovery. It took three and a half years for GDP to return to its pre-recession peak, and by most accounts this broad measure of economic activity remains below trend today. What precipitated the U.S. economy into the worst recession since the Great Depression? And what headwinds are holding back the recovery? Are these headwinds permanent, calling for a revision of our assessment of the economy’s speed limit? Or are they transitory, although very long-lasting, as the historical record on the persistent damages inflicted by financial crisis seems to suggest? In this post, we address these questions through the lens of the FRBNY DSGE model.

Continue reading "Developing a Narrative: The Great Recession and Its Aftermath" »

September 25, 2013

Catching Up or Falling Behind? New Jersey Schools in the Aftermath of the Great Recession

Rajashri Chakrabarti and Max Livingston

Today’s post, which complements Monday’s on New York State and a set of interactive graphics released by the New York Fed earlier, assesses the effect of the Great Recession on educational finances in New Jersey. The Great Recession severely restricted state and local funds, which are the main sources of funding for schools. To help avoid steep budget cuts to schools, the federal government allocated $100 billion for education as part of the American Recovery and Reinvestment Act of 2009 (ARRA), also known as the stimulus. The stimulus money was meant to provide temporary relief to strained state and local budgets. However, after the stimulus funds were exhausted, the economy was still weak and school districts were faced with large budget shortfalls.

Continue reading "Catching Up or Falling Behind? New Jersey Schools in the Aftermath of the Great Recession" »

Posted by Blog Author at 7:00 AM in Great Recession, New Jersey, Recession | Permalink | Comments (0)

September 23, 2013

Waiting for Recovery: New York Schools and the Aftermath of the Great Recession

Rajashri Chakrabarti and Max Livingston

A key institution that was significantly affected by the Great Recession is the school system, which plays a crucial role in building human capital and shaping the country’s economic future. To prevent major cuts to education, the federal government allocated $100 billion to schools as part of the American Recovery and Reinvestment Act of 2009 (ARRA), commonly known as the stimulus package. However, the stimulus has wound down while many sectors of the economy are still struggling, leaving state and local governments with budget squeezes. In this post, we present some key findings on how school finances in New York State fared during this period, drawing on our recent study and a series of interactive graphics. As the stimulus ended, school district funding fell dramatically and districts across the state enacted significant cuts across the board, affecting not only noninstructional spending but also instructional spending—the category most closely related to student learning.

Continue reading "Waiting for Recovery: New York Schools and the Aftermath of the Great Recession" »

July 22, 2013

Just Released: Mapping Changes in School Finances

Rajashri Chakrabarti and Max Livingston

This morning, the New York Fed released a set of interactive maps and charts illuminating school finances in New York and New Jersey. These user-friendly graphics illustrate the progression of various school finance indicators over time. They also make clear the large variability in finances across districts and states.  

Continue reading "Just Released: Mapping Changes in School Finances" »

Posted by Blog Author at 7:02 AM in Education, Fed Funds, New York, Recession, Regional Analysis | Permalink | Comments (1)

June 26, 2013

States Are Recovering Lost Jobs at Surprisingly Similar Rates

Jason Bram and James Orr

The U.S. economy lost more than 8 million jobs between January 2008 and February 2010. In contrast with earlier recessions, employment declines were seen across almost all states. The extent varied: In this recession, states with big housing busts generally saw steeper job losses, especially in construction, while some states also had severe job losses driven by manufacturing declines. One feature of this employment recovery is that it’s actually been quite uniform across states—and much more uniform than in earlier recoveries. With few exceptions, states appear to be marching in lockstep.

Continue reading "States Are Recovering Lost Jobs at Surprisingly Similar Rates" »

February 06, 2013

How Did Education Financing in New Jersey’s Abbott Districts Fare during the Great Recession?

Rajashri Chakrabarti and Sarah Sutherland

In the state of New Jersey, any child between the ages of five and eighteen has the constitutional right to a thorough and efficient education. The state also has one of the country’s most rigid policies regarding a balanced budget. When state and local revenues took a big hit in the most recent recession, officials had to make tough decisions about education spending. In this post, we analyze education financing and spending in two groups of high-poverty districts during the Great Recession and the ARRA (American Recovery and Reinvestment Act of 2009) federal stimulus period—the Abbott and Bacon districts. Analysis in our recent New York Fed staff report shows that the Abbott districts exhibited the sharpest declines—relative to trend—in both total funding and total spending per pupil during the post-recession era. Additionally, the Abbott districts were the only group of districts in New Jersey to present statistically significant negative shifts in instructional spending, even with the federal stimulus.

Continue reading "How Did Education Financing in New Jersey’s Abbott Districts Fare during the Great Recession?" »

April 16, 2012

Forecasting the Great Recession: DSGE vs. Blue Chip

Marco Del Negro, Daniel Herbst,* and Frank Schorfheide

Dynamic stochastic general equilibrium (DSGE) models have been trashed, bashed, and abused during the Great Recession and after. One of the many reasons for the bashing was the models’ alleged inability to forecast the recession itself. Oddly enough, there’s little evidence on the forecasting performance of DSGE models during this turbulent period. In the paper “DSGE Model-Based Forecasting,” prepared for Elsevier’s Handbook of Economic Forecasting, two of us (Del Negro and Schorfheide), with the help of the third (Herbst), provide some of this evidence. This post shares some of our results.

Continue reading "Forecasting the Great Recession: DSGE vs. Blue Chip" »

March 30, 2012

Just Released: Chairman Bernanke Returns to His Academic Roots, Part 2

Argia M. Sbordone

This week, Federal Reserve Chairman Ben Bernanke completed his four-lecture series for undergraduate students at the George Washington School of Business in Washington, D.C. The lectures have been part of the Chairman’s ongoing effort to educate the public about the Federal Reserve and the role it played during the recent financial crisis. Building upon last week’s broad overview of the origin and mission of central banks and the lessons learned from previous financial crises, this week’s lectures—presented on March 27 and 29—centered on the financial crisis that emerged in 2007. The Chairman discussed the build-up of the crisis and the actions taken by the Federal Reserve and other central banks to address the financial crisis and the ensuing recession.

Continue reading "Just Released: Chairman Bernanke Returns to His Academic Roots, Part 2" »

Posted by Blog Author at 7:00 AM in Education, Lender of Last Resort, Monetary Policy, Recession | Permalink | Comments (0)

March 23, 2012

Just Released: Chairman Bernanke Returns to His Academic Roots

Argia M. Sbordone

Federal Reserve Chairman Ben Bernanke is back in the classroom this month to deliver a series of four lectures for undergraduate students at the George Washington School of Business in Washington, D.C. It’s a welcome reconnection with students for Chairman Bernanke, who joined the Federal Reserve System in 2002 after a long career as an economics professor at Stanford University and later at Princeton University. The lectures at the George Washington School are part of Bernanke’s ongoing effort to educate the public about the role played by the Federal Reserve during the recent financial crisis. The nature and the scope of these lectures allow the Chairman to draw upon his background as a scholar of the Great Depression and his experience at the helm of the U.S. central bank to put the financial crisis in a broader context. The Chairman will talk about the origins and mission of central banks, identify the lessons learned from previous financial crises, and describe how those lessons informed the Fed's decisions during the recent crisis.

Continue reading "Just Released: Chairman Bernanke Returns to His Academic Roots" »

Posted by Blog Author at 7:00 AM in Central Bank, Education, Inflation, Monetary Policy, Recession | Permalink | Comments (2)

February 01, 2012

Tough Decisions, Depleted Revenues: New Jersey’s Education Finances during the Great Recession

Rajashri Chakrabarti and Sarah Sutherland*

Today’s post, which complements Monday’s on New York State, considers the Great Recession’s impact on education funding in New Jersey. Using analysis published in our recent staff report, “Precarious Slopes? The Great Recession, Federal Stimulus, and New Jersey Schools,” we examine how school finances were affected during the recession and the ARRA federal stimulus period. We find strong evidence of a significant decline—relative to trend—in school revenues and expenditures following the recession as well as key compositional changes that could affect school financing and student learning. Our findings are noteworthy in view of the importance of investing in children’s education for human capital formation and economic growth.

Continue reading "Tough Decisions, Depleted Revenues: New Jersey’s Education Finances during the Great Recession" »

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