Investment-specific technology (IST) shocks have been shown to play a significant role in explaining the business cycle dynamics of the US economy. Recently a debate has arisen over the extent to which these shocks aid our understanding of international business cycles as well. This paper...

This paper quantifies cross-country differences in early childhood human capital. I embed a standard human capital production function into a cross-country model of human capital investment and labor market outcomes. The model predicts that only some human capital investment channels generate...

We derive a simple equation to calculate the global welfare impact of the simultaneous reduction of trade costs between multiple country-pairs. Interestingly, we find that we obtain the same equation for a broad class of trade models. Moreover, balanced trade is mostly not required for the...

This paper investigates theoretically and empirically the relationship between the geographic structure of a multinational corporation and its stock market returns. We use a structural model to identify two main channels through which the fact of being a multinational firm affects returns. On...

In this paper, we ask to what extent changes to the age and sex structure of the population account for the changes in the marriage behavior observed in the United States in the last century (from 1900 to 1980). The decrease in mortality, especially for women, and the changes in immigration...

Are fixed costs to using financial intermediation quantitatively important in explaining income differences across-countries? I introduce fixed costs into an entrepreneurship model with financial frictions where agents are heterogeneous in their financial assets, entrepreneurial ability and...

Using the Survey of Income and Program Participation (SIPP) we estimate quarterly labor earnings risk across 21 industries of the US economy. We document a significant and positive association between earnings risk (both permanent and transitory) and average log-earnings across industries. The...

We consider a matching model of employment with wages that are flexible for new hires, but sticky within matches. We depart from standard treatments of sticky wages by allowing worker effort to respond to the wage being too high or low, rendering the effective wage (wage divided by output) more...

We present empirical evidence and a theoretical argument that uncertainty shocks act like a negative aggregate demand shock, which raises unemployment and lowers inflation. We measure uncertainty using survey data from the United States and the United Kingdom. We estimate the macroeconomic...

We study a political economy model of entry barriers. Each period the policymaker determines whether to impose a high barrier on entry, and the special interest groups try to influence the policymaker's decision. Entry is accompanied by creative destruction— when many new firms enter, old...