We study the optimal hiring and firing decisions of a firm under two different firing costs regulations: 1) Dual labor markets characterized by high firing costs for workers with seniority above a threshold ("permanent workers") and by low costs for "temporary workers". 2) The Single Labor...

This paper studies children as a risky asset associated to an investment option. Children provide utility but have a stochastic maintenance cost. We obtain several new results relative to models where children are deterministic goods, among which: i) Higher child risks diminish fertility and...

We study the optimal hiring and firing decisions of a firm under two different firing costs regulations: 1) Dual labor markets characterized by high firing costs for workers workers". 2) The Single Labor Contract, a policy proposal to make firing costs increasing in seniority at the job. We...

We study the hiring and firing decisions of a firm in a Dual Labor market and in a Single Labor Contract. Under both regulations, to fire before a certain seniority threshold is similar to an American option that gives the right of firing at low costs. However, the value of the option is...

We study the effects of news about sea level rise on housing markets. We exploit a natural experiment in Spain. In 2014 Greenpeace published an alarming report predicting catastrophic consequences for La Manga, a tourist peninsula. The report was widely cited in the local news. We find that the...

We study how investors in housing markets have changed after the 2009 financial crisis and the consequences for the markets and the economy. We document several new facts: (a) Institutional investors have replaced individual investors. (b) Most new investors are buy-and-hold investors as they...

Using a new financial product (Credit Risk Transfers, CRTs) we study how markets would price hurricane risk in U.S. mortgages absent intervention from the government-sponsored enterprises (GSEs). We hand-collect a novel and detailed database to exploit CRTs' heterogeneous exposure to Hurricanes...