Despite the rise of sustainable investing, recent evidence shows that emerging markets receive a very small fraction of the capital allocated by investment funds to ‘green’ companies involved in carbon solutions. This column digs into the dynamics that inform investment allocation decisions by investment funds, exploring the motivations and constraints at both fund and country […]
Public trust is a cornerstone of central banking. Shocks to trust depress economic activity and may cause inflation expectations to increase. This column introduces a new measure of public trust in the Federal Reserve derived from nearly 4 million tweets about the institution. Macro-financial factors affect trust, as does Fed communication. But scandals that bring […]
Institutions play an important role in economic growth. The efficiency of institutions such as judicial systems varies across countries and may explain the differences in growth rates and per capita income (Acemoglu et al., 2005). A well-functioning court system eases the establishment of new commercial relations, lowers barriers to entry and enables new markets’ creation, ultimately promoting […]