volatility of aggregate shocks impinging on the domestic economy. The implications of this approach are analyzed in a model with … revenue lost in adverse states of nature. Higher volatility of producers' productivity shocks increases both financial spreads … volatility are non-linear. Higher volatility does not impose any welfare cost for countries characterized by relatively low …

. These features motivate us to build a model in which increased volatility of firm level productivity shocks generates a … limit firms' ability to insure against shocks. Hence, an increase in idiosyncratic volatility induces firms to reduce their …

including the Black-Scholes setup with infrequent trading, and a model with stochastic stock volatility and a varying riskfree …

the exchange rate volatility, cyclicality and the FX risk premia in the data …

with disdain for work. We propose an economic theory of preference formation where both the divergence of attitudes across … social classes and the ensuing reversal of economic fortunes are equilibrium outcomes. In our theory, parents shape their …