Search Results
Working Paper
Living Up to Expectations: The Effectiveness of Forward Guidance and Inflation Dynamics Post-Global Financial Crisis
Martínez García, Enrique; Sims, Eric; Cole, Stephen J.
(2025-04-03)
This paper studies the effectiveness of forward guidance when central banks face private agents with heterogeneous expectations allowing for a degree of bounded rationality. Exploiting unique survey-based measures of expected inflation, output growth and interest rates, we estimate a small-scale New Keynesian model with forward guidance shocks for the United States and the other G7 countries plus Spain. We find that the share of fully-informed rational expectations (FIRE) agents in aggregate expectations is similar for the U.S., the U.K., Germany and other major advanced economies (albeit far ...
Globalization Institute Working Papers
, Paper 424
Report
The Macroeconomic Dynamics of Labor Market Policies
Hurst, Erik; Kehoe, Patrick J.; Pastorino, Elena; Winberry, Thomas
(2025-03-28)
We develop a dynamic macroeconomic framework with worker heterogeneity, putty-clay adjustment frictions, and firm monopsony power to study the distributional impact of labor market policies over time. Our framework reconciles the well-known tension between low short-run and high long-run elasticities of substitution across inputs of production, especially among workers with different skills within a same education group. We use this framework to evaluate the effects of redistributive policies such as the minimum wage and the Earned Income Tax Credit. We argue that since these policies ...
Staff Report
, Paper 668
Working Paper
Capital Taxation with Heterogeneous Discounting and Collateralized Borrowing
Biljanovska, Nina; Vardoulakis, Alexandros
(2017-05-05)
We study optimal long-run capital taxation in a closed economy with heterogeneity in agents' time-discount factors where borrowing is allowed but restricted by a collateral constraint. Financial frictions distort intertemporal optimization margins and the tax system serves a dual role: first, it is used to finance government consumption; second, it serves to alleviate the distortions arising from the binding collateral constraint. The discrepancy between the private and the social discount factors pushes for a subsidy on capital, while the discrepancy introduced by the collateral constraint ...
Finance and Economics Discussion Series
, Paper 2017-053
Report
On the Efficiency of Competitive Equilibria with Pandemics
Chari, V. V.; Kirpalani, Rishabh; Perez, Luis
(2023-04-05)
The epidemiological literature suggests that virus transmission occurs only when individuals are in relatively close contact. We show that if society can control the extent to which economic agents are exposed to the virus and agents can commit to contracts, virus externalities are local, and competitive equilibria are efficient. The Second Welfare Theorem also holds. These results still apply when infection status is imperfectly observed and when agents are privately informed about their infection status. If society cannot control virus exposure, then virus externalities are global and ...
Staff Report
, Paper 644
Working Paper
Banking on seniority: the IMF and the sovereign’s creditors
Erce, Aitor
(2014-05-13)
The programs designed by the International Monetary Fund during the Global Financial Crisis have shown more awareness of the importance of domestic demand for the prospects of economic recovery. Yet, the IMF has continued to do little about the late payments made by governments to domestic creditors and suppliers. In contrast, the greater protection historically awarded by the IMF to foreign creditors has endured throughout the recent crisis. The paper suggests that, in order to adequately balance foreign creditor seniority and growth objectives, the IMF may sometimes need to emphasize ...
Globalization Institute Working Papers
, Paper 175
Working Paper
Business Cycle Fluctuations in Mirrlees Economies: The Case of i.i.d. Shocks
Veracierto, Marcelo
(2019-12-15)
I consider a real business cycle model in which agents have private information about the i.i.d. realizations of their value of leisure. For the case of logarithmic preferences I provide an analytical characterization of the solution to the associated mechanism design problem. Moreover, I show a striking irrelevance result: That the stationary behavior of all aggregate variables are exactly the same in the private information economy as in the full information case. Numerical simulations indicate that the irrelevance result approximately holds for more general CRRA preferences.
Working Paper Series
, Paper WP 2020-04
Working Paper
Global Spillovers of a China Hard Landing
Goernemann, Nils; Dias, Daniel A.; Hoek, Jasper; Jain, Anil K.; Ahmed, Shaghil; Correa, Ricardo; Wong, Anna; Liu, Edith X.
(2019-10-18)
China?s economy has become larger and more interconnected with the rest of the world, thus raising the possibility that acute financial stress in China may lead to global financial instability. This paper analyzes the potential spillovers of such an event to the rest of the world with three methodologies: a VAR, an event study, and a DSGE model. We find the sentiment channel to be the primary spillover channel to the United States, affecting global risk aversion and asset prices such as equity prices and the dollar, in addition to modest real effects through the trade channel. In comparison, ...
International Finance Discussion Papers
, Paper 1260
Report
Pareto Improving Fiscal and Monetary Policies: Samuelson in the New Keynesian Model
Aguiar, Mark; Amador, Manuel; Arellano, Cristina
(2023-06-16)
This paper explores the positive and normative consequences of government bond issuances in a New Keynesian model with heterogeneous agents, focusing on how the stock of government bonds affects the cross-sectional allocation of resources in the spirit of Samuelson (1958). We characterize the Pareto optimal levels of government bonds and the associated monetary policy adjustments that should accompany Pareto-improving bond issuances. The paper introduces a simple phase diagram to analyze the global equilibrium dynamics of inflation, interest rates, and labor earnings in response to changes in ...
Staff Report
, Paper 646
Working Paper
The political economy of endogenous taxation and redistribution
Dolmas, Jim; Huffman, Gregory W.
(1997)
This paper examines a simple dynamic model in which agents vote over capital income taxation and redistributive transfers. We show that in equilibrium the typical agent's preferences over the tax rate are single-peaked and derive a closed-form solution for the majority-rule tax rate. We also show that high levels of initial wealth inequality can place the economy on the 'wrong side of the Laffer curve'.
Working Papers
, Paper 9704
FILTER BY year
FILTER BY Bank
Federal Reserve Bank of Minneapolis 18 items
Board of Governors of the Federal Reserve System (U.S.) 15 items
Federal Reserve Bank of St. Louis 14 items
Federal Reserve Bank of Dallas 10 items
Federal Reserve Bank of Atlanta 5 items
Federal Reserve Bank of San Francisco 3 items
Federal Reserve Bank of Chicago 2 items
Federal Reserve Bank of Philadelphia 2 items
Federal Reserve Bank of Kansas City 1 items
Federal Reserve Bank of New York 1 items
Federal Reserve Bank of Richmond 1 items
show more (6)
show less
FILTER BY Series
Working Papers 23 items
Staff Report 12 items
Finance and Economics Discussion Series 11 items
Globalization Institute Working Papers 8 items
Working Paper Series 5 items
International Finance Discussion Papers 4 items
FRB Atlanta Working Paper 3 items
Policy Hub 2 items
Economic Policy Paper 1 items
Economic Review 1 items
Staff Reports 1 items
Working Paper 1 items
show more (7)
show less
FILTER BY Content Type
FILTER BY Author
Paul, Pascal 10 items
Faria-e-Castro, Miguel 8 items
Sanchez, Juan M. 8 items
Carlson, Mark A. 7 items
Chari, V. V. 7 items
Zarutskie, Rebecca 7 items
Cole, Stephen J. 6 items
Martinez-Garcia, Enrique 5 items
Nicolini, Juan Pablo 5 items
Teles, Pedro 5 items
Andolfatto, David 3 items
Hotchkiss, Julie L. 3 items
Kehoe, Patrick J. 3 items
Martin, Fernando M. 3 items
Sims, Eric 3 items
Amol, Amol 2 items
Graves, Sebastian 2 items
Gregory, Victoria 2 items
Krainer, John 2 items
Ljungqvist, Lars 2 items
Luttmer, Erzo G. J. 2 items
Pastorino, Elena 2 items
Prescott, Edward C. 2 items
Rogers, John H. 2 items
Sargent, Thomas J. 2 items
Agarwal, Sumit 1 items
Aguiar, Mark 1 items
Ahmed, Shaghil 1 items
Amador, Manuel 1 items
Amornsiripanitch, Natee 1 items
Amromin, Gene 1 items
Arellano, Cristina 1 items
Arslan, Yavuz 1 items
Bae, Jaeheung 1 items
Ben-David, Itzhak 1 items
Biljanovska, Nina 1 items
Bognanni, Mark 1 items
Brinca, Pedro 1 items
Bryan, Michael F. 1 items
Bäckman, Claes 1 items
Cascaldi-Garcia, Danilo 1 items
Chen, Daphne 1 items
Chomsisengphet, Souphala 1 items
Conesa, Juan Carlos 1 items
Corbae, Dean 1 items
Correa, Ricardo 1 items
D'Erasmo, Pablo 1 items
Datta, Deepa Dhume 1 items
Degerli, Ahmet 1 items
Dias, Daniel A. 1 items
Doh, Taeyoung 1 items
Dolmas, Jim 1 items
Dong, Mei 1 items
Erce, Aitor 1 items
Ferreira, Thiago Revil T. 1 items
Fleck, Johannes 1 items
Fourakis, Stelios 1 items
Fujiwara, Ippei 1 items
Gerardi, Kristopher S. 1 items
Goernemann, Nils 1 items
Goncalves, Silvia 1 items
Greenwald, Daniel L. 1 items
Grishchenko, Olesya V. 1 items
Guler, Bulent 1 items
Hale, Galina 1 items
Hanley, Douglas 1 items
Heathcote, Jonathan 1 items
Herkenhoff, Kyle F. 1 items
Herrera, Ana María 1 items
Hoek, Jasper 1 items
Huffman, Gregory W. 1 items
Hurst, Erik 1 items
Jahan-Parvar, Mohammad R. 1 items
Jain, Anil K. 1 items
Kapan, Tumer 1 items
Karabarbounis, Loukas 1 items
Kehoe, Timothy J. 1 items
Kilian, Lutz 1 items
Kim, Dasol 1 items
Kirpalani, Rishabh 1 items
Kolliner, Daniel 1 items
Kuruscu, Burhanettin 1 items
Liu, Edith X. 1 items
Londono, Juan M. 1 items
Loria, Francesca 1 items
Ma, Chang 1 items
Ma, Sai 1 items
Martínez García, Enrique 1 items
McGrattan, Ellen R. 1 items
Melcangi, Davide 1 items
Meyer, Brent 1 items
Minoiu, Camelia 1 items
Mitman, Kurt 1 items
Moore, Robert E. 1 items
Moran, Patrick 1 items
Nakazono, Yoshiyuki 1 items
Ohanian, Lee E. 1 items
Olson, Luke 1 items
Parker, Nicholas B. 1 items
Perez, Luis 1 items
Pesavento, Elena 1 items
Phan, Toan 1 items
Piskorski, Tomasz 1 items
Qi, Shi 1 items
Rodriguez, Marius del Giudice 1 items
Santacreu, Ana Maria 1 items
Sarisoy, Cisil 1 items
Schlagenhauf, Don E. 1 items
Seru, Amit 1 items
Storesletten, Kjetil 1 items
Sun, Ling 1 items
Turen, Javier 1 items
Ueda, Kozo 1 items
Vardoulakis, Alexandros 1 items
Veracierto, Marcelo 1 items
Violante, Giovanni L. 1 items
Wessel, Ryan 1 items
Willen, Paul S. 1 items
Winberry, Thomas 1 items
Wong, Anna 1 items
Wright, Randall 1 items
Young, Henry L. 1 items
Zer, Ilknur 1 items
Zhou, Sili 1 items
de Soyres, Francois 1 items
van Santen, Peter 1 items
show more (121)
show less
FILTER BY Jel Classification
G21 23 items
E52 16 items
E58 14 items
E44 11 items
E43 10 items
G32 10 items
E32 9 items
E24 8 items
E30 8 items
E61 8 items
E62 8 items
D84 6 items
E40 5 items
E50 5 items
E63 3 items
E65 3 items
F30 3 items
F40 3 items
G01 3 items
G28 3 items
G33 3 items
H20 3 items
J64 3 items
P52 3 items
D14 2 items
E00 2 items
E20 2 items
E21 2 items
E31 2 items
E51 2 items
F34 2 items
F41 2 items
F44 2 items
G15 2 items
G51 2 items
H60 2 items
H70 2 items
I10 2 items
J22 2 items
J26 2 items
B40 1 items
C10 1 items
C22 1 items
C32 1 items
C50 1 items
C51 1 items
C81 1 items
C90 1 items
D12 1 items
D16 1 items
D62 1 items
D72 1 items
D82 1 items
D83 1 items
E02 1 items
E13 1 items
E22 1 items
E23 1 items
E37 1 items
E47 1 items
F33 1 items
F35 1 items
F36 1 items
F38 1 items
F42 1 items
F50 1 items
G00 1 items
G10 1 items
G18 1 items
G20 1 items
G22 1 items
H21 1 items
H25 1 items
H3 1 items
H30 1 items
H40 1 items
H41 1 items
I30 1 items
J00 1 items
J08 1 items
J31 1 items
J42 1 items
L22 1 items
L85 1 items
O40 1 items
Q54 1 items
R31 1 items
R50 1 items
show more (84)
show less
FILTER BY Keywords
Discount window 7 items
Federal Reserve 7 items
Funding for lending 7 items
Monetary policy tools 7 items
bank lending 6 items
evergreening 6 items
misallocation 6 items
zombie firms 6 items
COVID-19 5 items
Capital income tax 5 items
Fiscal policy 5 items
monetary policy 5 items
Monetary Policy 4 items
Production efficiency 4 items
inflation 4 items
unemployment 4 items
Border adjustment 3 items
Central Bank Credibility 3 items
Expectations 3 items
Forward Guidance 3 items
Free trade 3 items
Origin- and destination-based taxation 3 items
Value-added taxes 3 items
forward guidance 3 items
heterogeneous expectations 3 items
hysteresis 3 items
labor market gaps 3 items
Banks 2 items
Economic policy 2 items
Evergreening 2 items
Foreclosures 2 items
Inflation 2 items
Laffer curve 2 items
Lockdowns 2 items
Misallocation 2 items
central bank credibility 2 items
fiscal policy 2 items
labor market disparities 2 items
labor supply elasticity 2 items
price level 2 items
racism 2 items
retirement 2 items
social security reform 2 items
taxation 2 items
time averaging 2 items
zombie lending 2 items
100 percent reserve banking 1 items
1982 recession 1 items
Aggregate economic theory 1 items
Aggregate financial economics 1 items
Aggregation 1 items
Amortization payments 1 items
Automatic stabilizers 1 items
Bank industry dynamics 1 items
Bond insurance 1 items
Bunching 1 items
Business cycle accounting 1 items
Business cycle fluctuations 1 items
China 1 items
Collateral constraint 1 items
Corporate Income Tax 1 items
Covid 1 items
Covid-19 1 items
Credit Lines 1 items
Crises 1 items
Cross-country externalities 1 items
Cross-country insurance 1 items
Cross-country transfers 1 items
Debt crises 1 items
Debt renegotiation 1 items
Depressions 1 items
Development 1 items
Distributional effects 1 items
Downside risk 1 items
EITC 1 items
Econ-sir 1 items
Economic Conditions 1 items
Economic geography 1 items
Economy 1 items
Employment 1 items
Endogenous growth 1 items
Epidemics 1 items
Eurozone 1 items
Evolutionary Games 1 items
Financial crisis 1 items
Financial system 1 items
Firms 1 items
Fiscal externalities 1 items
Fiscal theory of the price level 1 items
Foreign bank competition 1 items
Friedman monetary satiation 1 items
Geopolitical risk 1 items
Global banks 1 items
Government debt 1 items
Government intervention 1 items
Great Recession 1 items
Gross Domestic Product 1 items
HAMP 1 items
Health crises 1 items
Heterogeneous agents 1 items
Heterogeneous discount factors 1 items
Household and bank balance sheets 1 items
Housing crisis 1 items
Housing market 1 items
Incomplete markets 1 items
Inequality 1 items
Inflation rate targeting 1 items
Interest rate targeting 1 items
International financial markets 1 items
International transfers 1 items
Labor taxes 1 items
Legal form of Organization 1 items
Local public goods 1 items
Log consumption 1 items
Long run 1 items
Long-run idiosyncratic risk 1 items
Macroprudential policy 1 items
Minimum wage 1 items
Monetary policy 1 items
Money in production function 1 items
Monopsony power 1 items
Mortgage debt 1 items
Mortgage design 1 items
Mortgage modification 1 items
Neoclassical growth theory 1 items
Official lending 1 items
Optimal currency area 1 items
Output loss 1 items
Price level determinacy 1 items
Primary deficits 1 items
Prosperities 1 items
Public debt 1 items
RBC methodology 1 items
RBC model 1 items
Ramsey taxation 1 items
Redistribution 1 items
Ricardian 1 items
Ricardian Equivalence 1 items
Rollover crisis 1 items
Servicers 1 items
Short and long run elasticity of substitution 1 items
Sovereign debt 1 items
Spillovers 1 items
Supply chains 1 items
Tax and transfer progressivity 1 items
Tax on capital 1 items
Taylor rule 1 items
Time consistency 1 items
Trade policy 1 items
Transition dynamics 1 items
Uncertainty 1 items
Unemployment 1 items
Unemployment insurance 1 items
Uniform taxation 1 items
VAR-based forecasting 1 items
Virus exposure 1 items
Volatility 1 items
Voting 1 items
Worker heterogeneity 1 items
banks 1 items
business cycle 1 items
business cycles 1 items
climate risk 1 items
competition 1 items
covid-19 1 items
default 1 items
determinacy 1 items
expectations formation 1 items
financial crisis 1 items
firm subsidy 1 items
firms 1 items
global risks 1 items
heterogeneous agent 1 items
impulse response 1 items
labor force participation 1 items
liquid bonds 1 items
liquidity constraints 1 items
local projections 1 items
moral hazard. 1 items
mortgage 1 items
multiplier 1 items
municipal bonds 1 items
natural disasters 1 items
negative equity 1 items
nonlinear structural model 1 items
optimal contracts 1 items
political economy 1 items
potential outcomes model 1 items
price formation 1 items
private information 1 items
putty-clay model 1 items
rational inattention 1 items
real effects 1 items
real estate 1 items
redistributive taxation 1 items
securities 1 items
social insurance 1 items
startups 1 items
state and local taxes 1 items
state-dependence 1 items
strategic default 1 items
survey inflation expectations 1 items
trade networks 1 items
wage gaps 1 items
show more (199)
show less