We find that observed cross-country price differences primarily reflect regional market segmentation occurring within countries. Using a model of price-setting subject to costly search, we show that identification of national versus regional segmentation requires augmenting price data with...

What are the effects of financial integration on global comovement? Using a standard two-country DSGE model, I show that in response to country-specific supply shocks higher exposure to foreign assets leads to lower cross-country output correlations, while the opposite is true for...

The aim of this paper is to analyze and estimate salient characteristics of unemployment dynamics. Movements in unemployment are viewed as "chain reactions" of responses to labor market shocks, working their way through systems of interacting lagged adjustment processes. In the context of...

This paper presents a reappraisal of unemployment movements in the European Union. Our analysis is based on the chain reaction theory of unemployment, which focuses on (a) the interaction among labor market adjustment processes, (b) the interplay between these adjustment processes and the...

The paper explains the observed asymmetric inflation response to value-added tax (VAT) changes in Hungary by calibrating a standard sectoral menu cost model on a new micro-level CPI data set. The model is able to reproduce important moments of the data, and finds that the asymmetry can be...

This paper adopts the methodology developed by the Federal Reserve Bank of Atlanta to nowcast the expenditure components of Gross Domestic Product (GDP) for the Australian economy. The aim is to help assess the current state of the economy and to assist with macroeconomic forecasting. A range of...

This paper studies how quantitative easing (QE) affects household welfare across the wealth distribution. I build a Heterogeneous Agent New Keynesian (HANK) model with household portfolio choice, wage and price rigidities, endogenous unemployment, frictional financial intermediation, an...