Since the provided list contains only two substantive publications (the Dallas Fed entries were blank), I have focused the briefing on the available research from the St. Louis Fed.
1. [STL] Geopolitical Distance and Targeted Trade: Evidence from Product-Level Export Controls
This paper quantifies how "geopolitical distance" accelerates the decoupling of trade through surgical export restrictions. It suggests that trade flows are becoming increasingly fragmented along ideological lines rather than economic efficiency, signaling a long-term shift toward higher structural inflation due to inefficient supply chains.
2. [STL] The Cost of Capital and Misallocation in the United States
The research examines how disparities in the cost of capital lead to resources being trapped in less productive firms, hindering aggregate productivity growth. For our team, this implies that prolonged high-interest-rate environments may exacerbate capital misallocation, potentially lowering the economy's long-run potential GDP.
Synthesis: The recent research highlights a dual threat to long-term growth: external fragmentation via geopolitical trade barriers and internal inefficiency through capital misallocation. Together, these trends suggest a "lower-growth, higher-cost" regime that may complicate the Fed's ability to maintain price stability without triggering deeper recessions.
The paper examines how geopolitical alignment influences the implementation of product-level export controls. It finds that trade restrictions are strategically targeted based on geopolitical distance to mitigate security risks.
This research analyzes how variations in the cost of capital lead to resource misallocation across the U.S. economy. It argues that these inefficiencies hinder overall productivity and aggregate economic output.
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