We propose a novel theory of self-fulfilling unemployment fluctuations. According to this theory, a firm hiring an …

stochastic general equilibrium real business cycle model that includes both a pollution externality and congestion externalities … congestion externalities substantially affects the value of the emissions tax, both in steady state and over the business cycle …

This paper develops a theory of expectations-driven business cycles based on learning. Agents have incomplete knowledge … series is captured, unlike in standard models. Inherited from real business cycle theory, the benchmark model suffers a …

We study how government policies and corporate commitments to decarbonize interact under two externalities …

This paper characterizes the optimal taxation of top earners in a world with externalities. It takes a reduced …-form approach that spans a broad class of models where top earners create externalities on the economy. The model allows for a … externalities (such as innovation) and negative externalities (such as rent-extraction). The model allows for simple optimal tax …

Externalities play a central role in most theories of economic growth. We argue that international externalities, in … have international knowledge externalities. When calibrated, the hybrid model does a surprisingly good job of generating …

Theory predicts that strategically-determined tax rates induce negative externalities across countries in relative … prices, the wealth distribution and tax revenue. This paper studies the interaction of these externalities in a dynamic …

negotiations are feasible and side payments are based on the realized level of externalities. Results show that an increase in …

capital spillovers can in theory increase aggregate productivity over and above the direct effect of human capital on … externalities that accrue to local geographic areas. The focus of the paper is on the empirical issues that arise in identifying … these externalities and on the existing empirical evidence on their magnitude. This paper was prepared as a chapter for the …