Annual Conference

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Corporate Finance

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May 2023

Market-Based Innovation Policy: Evidence from High-Tech Incubators in China

Vincent YAO, Tao SHU , Yue PAN, Pengdong ZHANG
Using proprietary data of all high-tech incubators in China, we study a new approach by government to implement industrial policy through market intermediaries instead of directly allocating resources. Exploiting a highly localized industrial policy that targets different “strategic emerging indus...
Keywords: Entrepreneurship, Incubators, High-tech startups, Industrial policy, Innovation
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Annual Conference

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International Macroeconomics, Money & Banking

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May 2023

The Political Economy of Financial Regulation

Arkodipta SARKAR, Rainer HASELMANN, Shikhar SINGLA, Vikrant VIG
Increased interdependencies across countries have led to calls for greater harmonization of regulations to prevent local shock from spilling over to other countries. Using the rulemaking process of the Basel Committee on Banking Supervision (BCBS), this paper studies the process through which harmon...
Keywords: Financial Regulation, Harmonisation of rulemaking, Basel, Political economy, Regulatory Capture, Wat
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Annual Conference

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International Macroeconomics, Money & Banking, Senior Fellows/Fellows

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May 2023

Reserves were not so ample after all

Darrell DUFFIE, Adam COPELAND, Yilin (David) YANG
The Federal Reserve’s “balance-sheet normalization,” which reduced aggregate reserves between 2017 and September 2019, increased repo rate distortions, the severity of rate spikes, and intraday payment timing stresses, culminating with a significant disruption in Treasury repo markets in mid-S...
Keywords: Repo rates, reserves, Treasuries, payments, central-bank balance sheet
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Annual Conference

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International Macroeconomics, Money & Banking

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May 2023

Central Bank Swap Lines: Micro-Level Evidence

Gerardo FERRARA, Philippe MUELLER, Ganesh VISWANATH-NATRAJ, Junxuan WANG
In this paper we investigate the price, volatility and micro-level effects of central bank swap lines during the 2020 pandemic. Following swap line auctions, these interventions reduced the level and volatility of covered interest rate parity violations. We combine dealer-level dollar auctions by th...
Keywords: swap lines, monetary policy, foreign exchange swaps, covered interest rate parity, central banking
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Annual Conference

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International Macroeconomics, Money & Banking

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May 2023

Jumpstarting an International Currency

Ricardo REIS, Saleem BAHAJ
While the USD dominates cross-border transactions today, a few other currencies are also used internationally. This paper shows that central bank policies that reduce the volatility of borrowing costs for foreign firms in domestic currency can trigger a jump-start of the currency’s international s...
Keywords: Currency Choice, RMB internationalization, Liquidity Lines, Invoicing Currency
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