We study the consumption-portfolio problem with realized capital gain taxation. The distinguishing feature of our analysis is that we impose on the model an important element of the tax code that has received little attention in the academic literature: the limited use of capital losses....

We develop a model of matching from firms' perspectives and draw resulting conclusions for the macro-dynamics of an economy. The key insight is that firms may wish to hire workers that are bad matches (having low productivity) in high-demand states, even if the worker must be hired to a long-run...

We analyze friendship formation patterns and develop a dynamic model of friendship formation that combines choices with random meeting patterns. We estimate biases in agents' preferences over the races of their friends and biases in the rates at which agents of various races meet each other. We...