This paper develops a dynamic Heckscher-Ohlin model and studies the interaction between international trade and wealth distribution dynamics. I also study how differences in the cost of financial intermediation among countries may affect the pattern of trade and wealth dynamics. Relative to the...

This paper argues that a guru possessing a multi-dimensional informational advantage may want to truthfully report her opinion to the media to learn more out of the actions of other, sometimes better-informed traders.

This paper investigates why high income households save on average a higher fraction of income than do low income households in US cross-section data. The three explanations considered are (1) age differences across households, (2) temporary earnings shocks and (3) the structure of social...

This paper considers testing that an economic time series follows a martingale difference process. The martingale difference hypothesis has been typically tested using information contained in the second moments of a process, that is, using test statistics based on the sample autocovariances or...

This paper develops a quantitative model of debt, default, and contagion of financial crises for small open economies that interact with risk averse international investors. The paper extends the recent literature on endogenous default risk to the case in which several emerging economies that...

To assess the employment effects of labor costs it is crucial to have reliable estimates of the labor cost elasticity of labor demand. Using a matched firm-worker dataset, we estimate a long run unconditional labor demand function, exploiting information on workers to correct for endogeneity in...

This paper develops a model of electoral turnout where parties compensate voters for showing up to the polls. Existence and uniqueness conditions are shown to impose substantial restrictions on the uncertainty about partisan support faced by the parties, and on the distribution of voting costs...

Recent empirical studies show that the intergenerational persistence of economic status in the U.S. is much higher than previously thought. We develop a quantitative theory of inequality and intergenerational transmission of human capital where parents invest in early and college education of...

We analyze an election in which voters are uncertain about which of two alternatives is better for them. Voters can, however, acquire some costly information about the alternatives. As the number of voters increases, individual investment in political information declines to zero. However, the...

The paper uses a factor analysis model to study co-movements in non-durable consumption and output among the fifty U.S. states from 1969 to 1995. The paper finds that asymmetric shocks in output are, on average, large, i.e., of the same magnitude of U.S. business cycle fluctuations. Regional...