This paper analyzes how information-processing limitations affect consumption in a dynamic full-fledged non-linnear quadratic Gaussian (LQG) setting. In the model, risk-averse consumers rationally choose the quantity and quality of information to process about their wealth, while constrained by...

This paper argues that the solution to a dynamic optimization problem of consumption and labor under finite information-processing capacity can simultaneously explain the intertemporal and intratemporal labor wedges. It presents a partial equilibrium model where a representative risk adverse...

Fiscal policy is as significant as, and sometimes more important than, monetary policy in determining the price level and, therefore, the dynamics of inflation.

This paper studies the implications of information-processing limits on the consumption and savings behavior of households through time. It presents a dynamic model in which consumers rationally choose the size and scope of the information they want to process concerning their financial...

Online appendix for the Review of Economic Dynamics article

Purpose: This study aims to blockchain facilitate information sharing among different players in the food industry, such as farmers, food suppliers and investors, enabling an effective decision-making process where the information about goods is traceable without any inherent risk. Although...

Cash transfers have been demonstrated to improve education and health outcomes and alleviate poverty in various contexts. However, policy makers and others often express concern that poor households will use transfers to buy alcohol, tobacco, or other "temptation goods." The income effect of...

As evidence from rigorous impact evaluations grows in development, there have been more calls to complement impact evaluation analysis with cost analysis, so that policy makers can make investment decisions based on costs as well as impacts. This paper discusses important considerations for...