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Daily Archives: December 22, 2013

Why Labor Force Participation (Usually) Increases When Unemployment Declines

Why Labor Force Participation (Usually) Increases When Unemployment Declines, by Andreas Hornstein, Federal Reserve Bank of Richmond, Economic Quarterly, Vol. 99, No. 1, First Quarter 2013, pp.1-23

“Unemployment and labor force participation (LFP) are usually negatively correlated over the business cycle, that is, once the unemployment rate starts to decline the LFP rate starts to increase after about half a year. Using gross ‡flow data on labor market transitions, we show that this cyclical co-movement pattern between the unemployment rate and the LFP rate can be attributed to two factors. First, low unemployment rates imply a low average exit rate from the labor force, which in turn increases the LFP rate. Second, transition rates from out-of-the-labor-force to employment without an intervening unemployment spell increase as unemployment rates decline. A third reason that is commonly mentioned as a source for the negative co-movement between unemployment and LFP cannot be con…firmed. According to this reasoning, unemployed workers are less likely to exit the labor force and inactive participants are more likely to join the labor force as unemployed when unemployment declines. In fact, the data suggest that the opposite is true. The behavior of unemployment and LFP in the current recovery has been ‘unusual’”— even though the unemployment rate has been declining since 2010, the LFP rate has not yet begun to increase. This unusual behavior is potentially informative about the relative magnitude of the cyclical and trend component in recent LFP rate movements.”

Saving for Retirement with Job Loss Risk

Saving for Retirement with Job Loss Risk by Borys Grochulski and Yuzhe Zhang. Federal Reserve Bank of Richmond, Economic Quarterly, Vol. 99, No. 1, First Quarter 2013, Pages 45-81. “This article studies a tractable theoretical model of optimal consumption and saving decisions with endogenous retirement. Particular attention is paid to the impact of an increase in the risk ofContinue Reading

DNI Announces the Declassification of the Existence of Collection Activities Authorized by President Bush Shortly After Attacks of September 11, 2001

News release, December 21, 2013: “Yesterday, the Director of National Intelligence (“DNI”) announced the declassification of the existence of collection activities authorized by President George W. Bush shortly after the attacks of September 11, 2001. Starting on October 4, 2001, President Bush authorized the Secretary of Defense to employ the capabilities of the Department of Defense,Continue Reading

Adequacy of USSS Efforts to Identify, Mitigate, and Address Instances of Misconduct and Inappropriate Behavior (Redacted)

DHS OIG – Adequacy of USSS Efforts to Identify, Mitigate, and Address Instances of Misconduct and Inappropriate Behavior (Redacted), December 20, 2013 “We found no evidence that USSS [United States Secret Service] employees frequently engage in behaviors contrary to conduct standards or that could cause a security concern. Although some employees engaged in certain misconduct during a foreignContinue Reading

President’s Council of Advisors on Science and Technology Weighs in on MOOCs

Letter to President Obama from the President’s Council of Advisors on Science and Technology (PCAST), December 13, 2013 [snipped] “After only two years of practical experience with MOOCs and related technologies, it is too early to tell whether substantial gains in the quality of instruction, access, achievement, and cost will be realized. But there is no question thatContinue Reading

FDA proposes new food defense rule

Proposed rule marks the 6th issued under FDA Food Safety Modernization Act this year: “As required by the bipartisan FDA Food Safety Modernization Act (FSMA), the U.S. Food and Drug Administration proposed a rule [Focused Mitigation Strategies to Protect Food Against Intentional Adulteration] that would require the largest food businesses in the United States and abroad to take stepsContinue Reading

The Most Important Economic Stories of 2013 – in 44 Graphs

The Atlantic – A record year for stocks. A meh year for wages. A weird year for Wall Street, by Matthew O’Brien  “Maybe it’s just me, but the last few years are getting tough to tell apart. Imagine a quiz question: Name that year where we threw obstacles in the recovery’s way, but kept growing slowly; where Europe avoided bothContinue Reading

Infographic Provides a State-by-State Look at How Uninsured People Will Fare Under the Affordable Care Act

“A new interactive infographic from the Kaiser Family Foundation presents a comprehensive look at how the uninsured are expected to fare in each state next year after the Affordable Care Act (ACA) takes full effect on Jan. 1. The ACA provides new coverage options for many of the nation’s 47 million nonelderly uninsured people across the income spectrum,Continue Reading

LC Report – The Survival of American Silent Feature Films

“The Library of Congress unveiled  The Survival of American Silent Feature Films: 1912–1929, by David Pierce, the first comprehensive survey of American feature films that survived the silent era of motion pictures. Previous documentation established that nearly 11,000 (10,919) silent feature films of American origin were released from 1912 through 1929. There was, however, no definitive,Continue Reading

A Review of the Data Broker Industry: Collection, Use, and Sale of Consumer Data for Marketing Purposes

“Consumers are conducting more and more of their daily business online and through their mobile devices. They use the Internet and their smart phones and tablets to make purchases, research medical conditions, plan vacations, interact with friends and relatives, do their jobs, map travel routes, and otherwise pursue their interests. With these activities, consumers areContinue Reading