According to the National Bureau of Economic Research’s new working paper, high-productivity markets are not the main contributors to economic growth due to limited housing affordability options. The authors of the study found that high-productivity places like New York, San Francisco, and San Jose are not contributing to the GDP growth level in the U.S. as they should. Between 1964 and 2009, the level of labor productivity and demand grew rapidly in these three major cities due to capital-intensive dominant industries.
During this 45-year period, the local economies grew 19.3 percent, but these cities only contributed to 6.1 percent of growth in the U.S. According to the study, most of the growth contribution stemmed from Southern cities and other urban areas. The authors predict that by lowering regulatory constraints in these larger cities to the level of the median city, their work force could expand and potentially increase the GDP by 9.7 percent.
Nationwide Biweekly Administration, Loan Payment Administration, and the company’s owner, Daniel Lipsky, are being sued by the Consumer Financial Protection Bureau in federal district court. The CFPB claims that Nationwide falsely advertised the interest savings consumers will achieve through a biweekly mortgage payment program called the Interest Minimizer and deceives consumers about the price of the program. The CFPB hopes to gain compensation for harmed participants, a civil penalty, and an injunction against the companies and their owner.