Showing 1 - 10 of 293
We propose a new business cycle theory. Firms need to randomize over firing or keeping workers who have performed …
Persistent link: https://www.econbiz.de/10012456927
Using responses obtained through the Nielsen Homescan panel survey, we explore the differences between managers' and … non-managers' expectations and perceptions of inflation and unemployment. By and large, managers and non-managers exhibit … information provided in a randomized control trial. Finally, the inflation expectations of managers deviate systematically from …
Persistent link: https://www.econbiz.de/10013191080
Does attracting or losing jobs in high paying sectors have important spill-over effects on wages in other sectors? The answer to this question is central to a proper assessment of many trade and industrial policies. In this paper, we explore this question by examining how predictable changes in...
Persistent link: https://www.econbiz.de/10012465649
In a model with multiple Pareto-ranked equilibria we add trade in assets that pay based on the realization of a sunspot. Asset trading restricts the equilibrium set in a way that raises welfare by eliminating equilibria with a high likelihood of disasters. When the probability of a disaster is...
Persistent link: https://www.econbiz.de/10012457853
This chapter develops a unified framework for the study of how network interactions can function as a mechanism for propagation and amplification of microeconomic shocks. The framework nests various classes of games over networks, models of macroeconomic risk originating from microeconomic...
Persistent link: https://www.econbiz.de/10012457735
This paper examines the extent to which permanent terms-of-trade shocks have an asymmetric effect on private savings. The first part uses a simple three-period model to show that, if households expect to face binding borrowing constraints in bad states of nature, savings rates will respond...
Persistent link: https://www.econbiz.de/10012471007
The paper extends previous analysis of closed-economy inflation targeting to a small open economy with forward-looking aggregate supply and demand with some microfoundations, and with stylized realistic lags in the different transmission channels for monetary policy. The paper compares targeting...
Persistent link: https://www.econbiz.de/10012471032
This paper presents evidence that the cost channel' may be an important part of the monetary transmission mechanism. We argue that if working capital is an essential component of production and distribution, monetary contractions can affect output through a supply channel as well as the...
Persistent link: https://www.econbiz.de/10012471092
This paper develops a welfare-based model of monetary policy in an open economy. We focus on the extent to which monetary policy should be employed in maintaining the exchange rate. The traditional approach maintains that exchange rate flexibility is desirable in the presence of real...
Persistent link: https://www.econbiz.de/10012471102
In this paper, I develop a new identification method to solve the problem of simultaneous equations, based on heteroskedasticity of the structural shocks. I show that if the heteroskedasticity can be described as a two-regime process, then the system is just identified under relatively weak...
Persistent link: https://www.econbiz.de/10012471283