Abstract Negative interest rates policies (NIRP), usually depicted in economic textbooks as an impossibility due to the prospect of infinite demand for money, are now a reality in several countries due to different reasons. But while the ZLB has been surpassed when it comes to Central Banks, it...

This p aper explores the interaction between a credit crunch and the maturity of government debt, focusing on its impacts on an economy with heterogeneous house holds. We find that an increase in debt maturity helps softening the economicslump that follows a credit crisis. We show that,...

Expansionary fiscal policies have been advocated to induce output expansions and inflation in deep recession or deflationary episodes. We show that, in a fiscalist setup, an increase in deficits can trigger a stagflation by negatively affecting financial intermediation of resources to...

This paper explores the interaction between a credit crunch and the maturity of government debt, focusing on its impacts on an economy with heterogeneous households. We find that an increase in debt maturity helps softening the economic slump that follows a credit crisis. We show that,...

Expansionary fiscal policies have been advocated to induce output expansions and inflation in deep recession or deationary episodes. We show that, in a fiscalist setup, an increase in deficits can trigger a stagation by negatively affecting financial intermediation of resources to investments....

We derive a measure of the degree of inefficiency of the production structure of an economy by casting its optimal sectoral composition as the outcome of a portfolio allocation problem, in the spirit of Koren and Tenreyro (2004). We use the framework to construct measures of inefficiency using...

This paper introduces cash transfers targeting the poor in an incomplete marketsmodel with heterogeneous agents facing idiosyncratic risk. These transfers change the degree of insurance in the economy and affect precautionary motives asymmetrically,leading the poorest households to decrease...

This paper characterizes optimal fiscal and monetary policy in a new keynesian model with sectorial heterogeneity in price stickiness. In particular, we (i) derive a purely quadratic welfare-based loss function from an approximation of the representative agent's utility function and (ii) provide...

This is the complete technical appendix to "Optimal Fiscal and Monetary Policy under Sectorial Heterogeneity".