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Farhi, Emmanuel - 2015

This paper develops a theory of optimal taxation with behavioral agents. We use a general behavioral framework that …

Persistent link: https://www.econbiz.de/10013016014

Farhi, Emmanuel - 2007

For an economy with altruistic parents facing productivity shocks, the optimal estate taxation is progressive: fortunate parents should face lower net returns on their inheritances. This progressivity reflects optimal mean reversion in consumption, which ensures that a long-run steady state...

Persistent link: https://www.econbiz.de/10012778251

Estate Taxation with Altruism Heterogeneity

Farhi, Emmanuel - 2013

We develop a theory of optimal estate taxation in a model where bequest inequality is driven by differences in parental …

Persistent link: https://www.econbiz.de/10013087049

Crash Risk in Currency Markets

Farhi, Emmanuel - 2010

expected exchange rate depreciations (appreciations) for high (low) interest rate currencies, suggesting that disaster risk is … priced in currency markets. To study the price of disaster risk, we propose a simple structural model that includes both … Gaussian and disaster risk and can be estimated even in samples that do not contain disasters. Estimating the model over the …

Persistent link: https://www.econbiz.de/10013152552

Accounting for Macro-Finance Trends : Market Power, Intangibles, and Risk Premia

Farhi, Emmanuel - 2018

Real risk-free interest rates have trended down over the past 30 years. Puzzlingly in light of this decline, (1) the … that rising market power, rising unmeasured intangibles, and rising risk premia, play a crucial role, over and above the … traditional culprits of increasing savings supply and technological growth slowdown …

Persistent link: https://www.econbiz.de/10012907462

Safe Asset Scarcity and Aggregate Demand

Caballero, Ricardo J. - 2016

We explore the consequences of safe asset scarcity on aggregate demand in a stylized IS-LM/Mundell Fleming environment. Acute safe asset scarcity forces the economy into a “safety trap” recession. In the open economy, safe asset scarcity spreads from one country to the other via capital...

Persistent link: https://www.econbiz.de/10012997884

A Model of the International Monetary System

Farhi, Emmanuel - 2016

We propose a simple model of the international monetary system. We study the world supply and demand for reserve assets denominated in different currencies under a variety of scenarios: a Hegemon vs. a multipolar world; abundant vs. scarce reserve assets; a gold exchange standard vs. a floating...

Persistent link: https://www.econbiz.de/10012990769

Macroeconomics with Heterogeneous Agents and Input-Output Networks

Baqaee, David Rezza - 2018

The goal of this paper is to simultaneously unbundle two interacting reduced-form building blocks of traditional macroeconomic models: the representative agent and the aggregate production function. We introduce a broad class of disaggregated general equilibrium models with Heterogeneous Agents...

Persistent link: https://www.econbiz.de/10012916627

Deadly Embrace : Sovereign and Financial Balance Sheets Doom Loops

Farhi, Emmanuel - 2016

and banking insolvency. This paper provides a theory of the feedback loop that allows for both domestic bailouts of the … banking system and sovereign debt forgiveness by international creditors or solidarity by other countries. Our theory has …

Persistent link: https://www.econbiz.de/10013001787

Entry vs. Rents : Aggregation with Economies of Scale

Baqaee, David; Farhi, Emmanuel - 2022

We characterize the response of aggregate output to micro shocks in disaggregated economies with entry, non-constant returns to scale, input-output linkages, and distortions. We decompose output changes into technical and allocative efficiency components, and show that the latter depends on...

Persistent link: https://www.econbiz.de/10013311647