general. This study uses a well-known class of stochastic growth models to show other difficulties with traditional empirical …

This paper develops a rational expectations model with multiple equilibrium unemployment rates where the price of … economic policies designed to reduce the volatility of asset market movements will significantly increase economic welfare. …

is not a bubble, whereas the following stock market crisis is largely due to negative noise shocks. …

. Frictions in the market for deposits create rents in the financial sector that affect workers' choice of occupation. When rents …

gold standard during the 1930s. We do this by separating expectations of taxation and of devaluation that are implicitly … expectations of a capital levy or other taxation devices; third that hyperinflation was not expected, even at the moment of maximum … low as the spot value. For the 1930s, we show that expectations of a depreciation of the franc explain the rise in …

exchange rate models, the exchange rate acts as an asset price, and as such responds to news about future returns on assets … exchange rates are asset prices. We outline a series of models in which an optimal policy eliminates the effects of news on …

We estimate the effect of pension reforms on households’ expectations of retirement outcomes and private wealth … population, elicits these expectations during a period of intense pension reforms between 1989 and 2002. These reforms had … of social security arrangements on expectations of retirement outcomes and household saving decisions. Our main findings …

standard neoclassical models cannot generate a simultaneous increase in consumption, investment, and hours in response to news … shocks, and that optimism in these models tends to reduce investment and hours. When technology is vintage specific, however …, expectations of higher future productivity raise the demand for new vintages of capital relative to installed capital. Capital …