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Temperature, Aggregate Risk, and Expected Returns
Bansal, Ravi - 2011
In this paper we show that temperature is an aggregate risk factor that adversely affects economic growth. Our argument … temperature (i.e., temperature betas) contains sharp information about the cross-country risk premium; countries closer to the … Equator carry a positive temperature risk premium which decreases as one moves farther away from the Equator. The differences …
Persistent link: https://www.econbiz.de/10013118834
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Risk, Volatility, and the Global Cross-Section of Growth Rates
Burnside, A. Craig - 2010
We reconsider the empirical links between volatility and growth between 1970 and 2007. There is a strong and significant correlation between individual country growth rates and global factors that are arguably exogenous with respect to their economies. The amount of volatility driven by these...
Persistent link: https://www.econbiz.de/10013151388
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Does Uncertainty Reduce Growth? Using Disasters as Natural Experiments
Baker, Scott R. - 2014
A growing body of evidence suggests that uncertainty is counter cyclical, rising sharply in recessions and falling in booms. But what is the causal relationship between uncertainty and growth? To identify this we construct cross country panel data on stock market levels and volatility as proxies...
Persistent link: https://www.econbiz.de/10013062729
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Climate Change and Growth Risks
Bansal, Ravi - 2017
accounts for the interaction between temperature, economic growth and risk. The model simultaneously matches the projected … temperature path, the observed consumption growth dynamics, discount rates provided by the risk-free rate and equity market …
Persistent link: https://www.econbiz.de/10012966590
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Uncertainty and Growth Disasters
Jovanovic, Boyan; Ma, Sai - 2022
This paper documents several facts on the real effects of economic uncertainty. First, higher uncertainty is associated with a more dispersed distribution of output growth. Second, the relation is highly asymmetric: A rise in uncertainty is associated with a sharp decline in the lower tail of...
Persistent link: https://www.econbiz.de/10014091106
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Fiscal Volatility Shocks and Economic Activity
Fernández-Villaverde, Jesús - 2011
We study the effects of changes in uncertainty about future fiscal policy on aggregate economic activity. Fiscal deficits and public debt have risen sharply in the wake of the financial crisis. While these developments make fiscal consolidation inevitable, there is considerable uncertainty about...
Persistent link: https://www.econbiz.de/10013121070
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The Economics of Inefficient Technology Use
Beaudry, Paul - 2012
The adoption and diffusion of technological knowledge is generally regarded as a key element in a country's economic success. However, as is the case with most types of information, the transfer of technological knowledge is likely to be subject to adverse selection problems. In this paper we...
Persistent link: https://www.econbiz.de/10012755309
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Macroeconomic Conditions and the Puzzles of Credit Spreads and Capital Structure
Chen, Hui - 2010
, economic uncertainty, and risk premia influence firms' financing and default policies. Countercyclical fluctuations in risk …. These comovements generate large credit risk premia for investment grade firms, which helps address the "credit spread …
Persistent link: https://www.econbiz.de/10013141351
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Policy Uncertainty, Persistence and Growth
Aizenman, Joshua - 2010
This paper explores links between policy uncertainty and growth. It provides evidence on the correlation between policy uncertainty and per capita real GDP for 46 developing countries over the 1970-85 period. Cross-section regressions on growth suggest that after accounting for standard...
Persistent link: https://www.econbiz.de/10013141088
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Consumption Risk-Sharing and the Real Exchange Rate : Why Does the Nominal Exchange Rate Make Such a Difference?
Devereux, Michael B. - 2011
A basic prediction of effcient risk-sharing is that relative consumption growth rates across countries or regions …, employing a newly constructed multi-country and multi-regional data set. Within countries, we find signifcant evidence for risk …. We identify this failure of risk sharing as a border effect. We find that the border effect is substantially (but not …
Persistent link: https://www.econbiz.de/10013121595