The FRED graph above shows total U.S. patents granted originating from China and Germany from 1992 through 2020, indexed to 100 in 1992.

Germany has long been the most innovative European country in terms of U.S. patents granted, and their total has steadily increased, by 152%, from 1992 to 2020. What’s interesting is how quickly China has closed the gap and even surpassed Germany in patents since joining the WTO on December 11, 2001. As part of their entry to the WTO, China agreed to the basic Trade-Related Aspects of Intellectual Property Rights (TRIPS) provisions protecting intellectual property rights.

In 2001, the U.S. granted 11,894 patents to German inventors, while granting only 266 to Chinese inventors. Over the next 19 years, as of 2020, U.S. patents granted to Germans increased 38% to just over 19,000 and U.S. patents granted to Chinese inventors increased nearly 10,000% to nearly 27,000.

While it’s easier to apply for a patent than to be...

“We really needed to help move the needle on educational materials, and so we’re working to provide educators with up-to-date information and quality teaching resources,” says Jane Ihrig, senior advisor and economist in the Program Direction section of Monetary Affairs at the Federal Reserve Board of Governors. Ihrig and Scott Wolla, Fed economic education coordinator, talk with media relations coordinator Shera Dalin about updates educators should make in teaching about new Fed monetary policy tools.

Businesses collect and deposit coins in depository institutions such as commercial banks. The banks send coins they don’t need for their customers through “correspondent” banks or directly to the 28 cash offices of the 12 regional Federal Reserve banks. The St. Louis Fed is one of the Reserve banks.

By Doreen Fagan, Manager and Senior Content Editor

Comparing an economy’s actual output with its potential output can provide useful information about the economy’s health.

The difference between actual output and potential output is known as the output gap, as discussed in a recent Page One Economics article by Scott Wolla. This economic measure is expressed as a percentage of potential output, which is estimated using potential gross domestic product (GDP), where:

“We really needed to help move the needle on educational materials, and so we’re working to provide educators with up-to-date information and quality teaching resources,” says Jane Ihrig, senior advisor and economist in the Program Direction section of Monetary Affairs at the Federal Reserve Board of Governors. Ihrig and Scott Wolla, Fed economic education coordinator, talk with media relations coordinator Shera Dalin about updates educators should make in teaching about new Fed monetary policy tools.

St. Louis Fed President James Bullard gave his perspective on the U.S. economy, inflation risks and tapering the Fed’s bond purchases, during an appearance on Washington Post Live.

In discussing U.S. inflation, Bullard said he thinks it will be more persistent than many people expect. He noted that if core PCE inflation is 3.5% for all of 2021, then he would expect it to be between 2.5% and 3% in 2022 and then gradually come down to the Federal Open Market Committee’s 2% target in the subsequent years.

Asked about the Fed’s $120 billion per month of bond purchases, which include mortgage-backed securities, Bullard said, “I don’t think that we need to continue with these purchases now that we’ve got new risks on the horizon and possibly inflation risks on the horizon.” He also said he thinks the FOMC should get the tapering going and finish the asset purchases by the end of the first quarter of 2022.

Bullard also discussed job creation, the booming housing...

Child poverty is higher in the Eighth Federal Reserve District than in the rest of the country. Recessions, such as the one caused by COVID-19, increase child poverty and income instability. Changes to the federal child tax credit (CTC) may help reduce the share of children living in poverty.

By Paulina Restrepo-Echavarria, Senior Economist; and Praew Grittayaphong, Research Associate

In 2020, governments around the globe started debt-financed spending to battle COVID-19 and to keep economies afloat. Although fiscal responses to this pandemic varied dramatically among countries, together, they added $24 trillion to global debt according to the Institute of International Finance (IIF).

Debt issuance helps cover the gap between how much a government wants to spend and the revenue it expects to receive that year. When issuing new debt, the government may decide to issue it in a local currency or a foreign currency. Foreign currency borrowing can help some countries attract diverse funding sources, mitigate investor fears of local currency fluctuations and reduce financial frictions. For those reasons, many emerging market economies issue a portion of their debt in U.S. dollars.

The views expressed are those of individual authors and do not necessarily reflect official positions of the Federal Reserve Bank of St. Louis, the Federal Reserve System, or the Board of Governors.

Chien and Bennett used state and local government expenditures data from the Annual Survey of State and Local Government Finances conducted by the Census Bureau to measure state government expenditures and state legislator data from the National Conference of State Legislatures to measure state political leanings.

The survey’s major government expenditure categories include education services, social services and income maintenance, transportation, public safety, and environment and housing.

To compare spending across states, the authors looked at expenditures as a ratio of state gross domestic product (GDP). Additionally, state political leanings were measured as the average proportion of Democratic state legislators (the state Senate and state lower house combined) minus the corresponding share of Republican state legislators from 2009 to 2018. This creates a measurement of state political leanings ranging from -1 (100% Republican leaning) to 1 (100% Democratic...

Chien and Bennett used state and local government expenditures data from the Annual Survey of State and Local Government Finances conducted by the Census Bureau to measure state government expenditures and state legislator data from the National Conference of State Legislatures to measure state political leanings.

The survey’s major government expenditure categories include education services, social services and income maintenance, transportation, public safety, and environment and housing.

To compare spending across states, the authors looked at expenditures as a ratio of state gross domestic product (GDP). Additionally, state political leanings were measured as the average proportion of Democratic state legislators (the state Senate and state lower house combined) minus the corresponding share of Republican state legislators from 2009 to 2018. This creates a measurement of state political leanings ranging from -1 (100% Republican leaning) to 1 (100% Democratic...

Child poverty is higher in the Eighth Federal Reserve District than in the rest of the country. Recessions, such as the one caused by COVID-19, increase child poverty and income instability. Changes to the federal child tax credit (CTC) may help reduce the share of children living in poverty.

By Paulina Restrepo-Echavarria, Senior Economist; and Praew Grittayaphong, Research Associate

In 2020, governments around the globe started debt-financed spending to battle COVID-19 and to keep economies afloat. Although fiscal responses to this pandemic varied dramatically among countries, together, they added $24 trillion to global debt according to the Institute of International Finance (IIF).

Debt issuance helps cover the gap between how much a government wants to spend and the revenue it expects to receive that year. When issuing new debt, the government may decide to issue it in a local currency or a foreign currency. Foreign currency borrowing can help some countries attract diverse funding sources, mitigate investor fears of local currency fluctuations and reduce financial frictions. For those reasons, many emerging market economies issue a portion of their debt in U.S. dollars.

Chien and Bennett used state and local government expenditures data from the Annual Survey of State and Local Government Finances conducted by the Census Bureau to measure state government expenditures and state legislator data from the National Conference of State Legislatures to measure state political leanings.

The survey’s major government expenditure categories include education services, social services and income maintenance, transportation, public safety, and environment and housing.

To compare spending across states, the authors looked at expenditures as a ratio of state gross domestic product (GDP). Additionally, state political leanings were measured as the average proportion of Democratic state legislators (the state Senate and state lower house combined) minus the corresponding share of Republican state legislators from 2009 to 2018. This creates a measurement of state political leanings ranging from -1 (100% Republican leaning) to 1 (100% Democratic...

Child poverty is higher in the Eighth Federal Reserve District than in the rest of the country. Recessions, such as the one caused by COVID-19, increase child poverty and income instability. Changes to the federal child tax credit (CTC) may help reduce the share of children living in poverty.

Businesses with no employees other than the owner often turned to personal funds in response to financial challenges during the pandemic. These nonemployers were less likely than employer firms to seek pandemic-related emergency funding and less likely to be approved.

The views expressed are those of individual authors and do not necessarily reflect official positions of the Federal Reserve Bank of St. Louis, the Federal Reserve System, or the Board of Governors.