Government expenditures are procyclical in emerging markets and counter-cyclical in developed economies. We show this pattern is driven by differences in social transfers. Transfers are more countercyclical and comprise a larger portion of spending in developed economies compared to emerging. In...

I studied the effects of monitoring on political turnover, when the politicians’ early actions affect future economic outcomes. I considered an infinite-horizon environment, where the expectation about the potential successor’s policy is endogenous. As a result, the incentive to replace the...

The elasticity of economic restrictions with respect to the virus's reproduction rate is higher in countries that had lower pre-pandemic levels of disposable income inequality. A stylized, heterogenous agents model with costly redistribution can account for that pattern. Our results suggest...