Consumption risk sharing among U.S. federal states increases in booms and decreases in recessions. We find that small firms' access to credit markets plays an important role in explaining this stylized fact: business cycle fluctuations in aggregate risk sharing are more pronounced in states in...

We examine theoretically and empirically the properties of the equilibrium wage function and its implications for policy. Our emphasis is on how the researcher approaches economic and policy questions when there is labor market heterogeneity leading to a set of wages. We focus on the application...

Economists often analyze cross-sectional data to estimate the value people implicit place on attributes of goods using hedonic methods. Usually strong enough assumptions are made on the functional form of utility to point identify individuals' willingness-to-pay (WTP) for changes in attribute...

This paper uses the European Commission's Consumer Survey to assess whether inflation expectations have converged and whether inflation uncertainty has diminished following the introduction of the Euro in Europe. Consumers' responses to the survey suggest that inflation expectations depend more...

Modelling of conditional volatilities and correlations across asset returns is an integral part of portfolio decision making and risk management. Over the past three decades there has been a trend towards increased asset return correlations across markets, a trend which has been accentuated...

Finding an instrument that is orthogonal to the disturbance term in the wage equation has been a topic of great deal of debate. Recently, Chesson et al. (2006) proposed that higher discount rates are significantly associated with a range of sexual behaviours, including having sex before age of...