This paper investigates the efficiency of household investment decisions in a unique dataset containing the disaggregated wealth and income of the entire population of Sweden. The analysis focuses on two main sources of inefficiency in the financial portfolio: underdiversification of risky...

We study a competitive model in which debt-financed firms may default in some states of nature. Incomplete markets prevent firms from hedging the risk of asset firesales when markets are illiquid. This is the only friction in the model and the only cost of default. The anticipation of such...

In this paper we present a recursive method for the numerical simulation of nonoptimal dynamic equilibrium models. This method builds upon a convergent operator over an expanded set of state variables. The fixed point of this operator defines the set of all Markovian equilibria. We study...

This paper analyzes fairness and bargaining in a dynamic bilateral matching market. Traders from both sides of the market are pairwise matched to share the gains from trade. The bargaining outcome depends on the traders’ fairness attitudes. In equilibrium fairness matters because of market...

With only a decade left to reduce emissions drastically, the scale, pace and extent of global transformation needed is truly demanding. Long-term emission goals and the nature of the low-emission transition in each country will be a function of its unique socio-economic priorities, capabilities,...

We consider a gradient boosting decision trees (GBDT) approach to predict large S&P 500 price drops from a set of 150 technical, fundamental and macroeconomic features. We report an improved accuracy of GBDT over other machine learning (ML) methods on the S&P 500 futures prices. We show that...

We estimate the value of ending a pandemic using the joint behavior of stock prices and a vaccine progress indicator during 2020. In a general equilibrium model, the observed market response to vaccine progress serves to identify the expected rate of loss of wealth during the pandemic, which...

This paper studies the design of mechanisms that are robust to misspecification. We introduce a novel notion of robustness that connects a variety of disparate approaches and study its implications in a wide class of mechanism design problems. This notion is quantifiable, allowing us to...

This paper presents a detailed 2019 Social Accounting Matrix (SAM) for Benin as a basis for policy analysis with a focus on agriculture, food processing and energy generation from byproducts. It is based on official statistics collected from national and international institutions (national...

This paper is a review essay of the latest volume of The Collected Works of F.A. Hayek, entitled 'The Market and other Orders.' The paper examines the development of Hayeks' ideas about order, as manifested in the essays collected in this volume. Issues examined include: Hayek's accounts of the...