Econometrica

Emmanuel Farhi · Iván Werning

This paper builds a theory of macroprudential policy whose only friction is nominal rigidity in goods and labor markets, possibly combined with a constraint on monetary policy such as the zero lower …

Robert E. Lucas Jr.

This 1978 Econometrica paper by Robert E. Lucas, Jr. builds a theoretical model of a one-good, pure-exchange economy with identical consumers and a fixed number of stochastically productive units, in …

George-Marios Angeletos · Chen Lian · Christian K. Wolf

The paper asks whether a government can run a deficit today — issuing "stimulus checks" — and allow debt to return to its initial level without any future tax hike or spending cut. In environments …

Farid Farrokhi · Ahmad Lashkaripour

Farrokhi and Lashkaripour (2025) study the interaction between trade policy and climate change. The central research question is whether and how countries can use trade policy — specifically import …

Robert M. Anderson · Haosui Duanmu

Anderson and Duanmu (2025) ask how general equilibrium (GE) interactions — factor reallocation across sectors, capital misallocation under climate uncertainty, and the distributional incidence of …

Ngoc-Sang Pham · Alexis Akira Toda

Tirole (1985) studied an overlapping generations model with capital accumulation and showed that the emergence of asset bubbles can resolve the capital over-accumulation problem when the economy is …

Andreas Haller · Stefan Staubli · Josef Zweimüller

This paper develops a sufficient statistics framework for the welfare analysis of disability insurance (DI) policy reforms and applies it to two reform episodes in Austria. The framework derives …

José Luis Montiel Olea · Mikkel Plagborg-Møller · Eric Qian · Christian Wolf

This paper provides formal theoretical results on the relative robustness of local projection (LP) and vector autoregression (VAR) confidence intervals for impulse response inference when the data …

Giacomo Lanzani

This paper asks how an agent who fears that none of their probabilistic models is the correct description of the data-generating process (DGP) should update that fear as evidence accumulates, and what …

Alexandr Kopytov · Bineet Mishra · Kristoffer Nimark · Mathieu Taschereau-Dumouchel

This paper studies how firms' optimal technique choices under productivity uncertainty endogenously shape the structure of production networks and aggregate macroeconomic outcomes. Each sector chooses …

Pablo Ottonello · Thomas Winberry

Combining high-frequency-identified monetary shocks with Compustat data, the paper shows that low-default-risk firms -- those with lower leverage and higher distance to default -- are substantially …

Naoki Aizawa · Corina Mommaerts · Stephanie Rennane

This paper studies (1) how firm accommodation decisions respond to financial incentives in the context of workplace disability under workers' compensation, (2) what the causal effect of accommodation …

Eduardo Azevedo · Jonathan Beauchamp · Richard Karlsson Linnér

This paper asks how much adverse selection would arise in critical illness insurance (CII) markets if consumers can observe polygenic indexes (PGIs) — genetic risk scores derived from millions of …

Robert E. Lucas, Jr.

Surveying and extending the Bailey-Friedman tradition of estimating the welfare cost of inflation, Lucas fits U.S. money-demand data for 1900-1994 and estimates that reducing annual inflation from 10 …

Franco Modigliani

This 1944 Econometrica paper by Franco Modigliani builds three alternative macrostatic systems of equations -- a Keynesian system and two classical variants -- that share identical saving, investment, …

José Luis Montiel Olea · Mikkel Plagborg-Møller

This 2021 Econometrica paper by José Luis Montiel Olea and Mikkel Plagborg-Møller studies what inference procedure applied researchers should use for local-projection (LP) estimates of impulse …

Mikkel Plagborg-Møller · Christian K. Wolf

This 2021 Econometrica paper by Mikkel Plagborg-Møller and Christian K. Wolf proves that local-projection (LP) and vector-autoregression (VAR) based impulse-response estimators are, at the population …

John H. Cochrane

Extending the fiscal theory of the price level to long-term government debt, Cochrane shows that the maturity structure of outstanding debt determines whether news about future deficits shows up as …

David Berger · Kyle Herkenhoff · Simon Mongey

Can minimum wages improve welfare through efficiency — by correcting monopsony-driven under-employment — and, if so, by how much? What is the optimal minimum wage, and how much of the welfare gain …

Natalie Bau · Adrien Matray

India liberalised foreign equity investment industry by industry in 2001 and 2006, and that staggered timing identifies what the policy did to the *distribution* of capital rather than only its level. …

J. R. Hicks

This paper, written within a year of the publication of Keynes's General Theory, asks how much of Keynes's theory is genuinely new by building a small formal model of the "classical" theory of income …

Oleg Itskhoki · Dmitry Mukhin

The Mussa (1986) puzzle is the empirical observation of a sharp, simultaneous increase in the volatility of both nominal and real exchange rates following the end of the Bretton Woods fixed exchange …

Scott T. Nelson

The 2009 Credit Card Accountability Responsibility and Disclosure (CARD) Act barred credit card lenders from discretionarily raising borrowers' interest rates in response to new information. Using the …

John F. Muth

This 1961 Econometrica paper by John Muth proposes that economic expectations should be modeled as essentially the same as the predictions of the relevant economic theory itself -- so that, for a …

Tom D. Holden

The paper proposes and analyzes real rate rules — monetary policy rules of the form i_t = r_t + φπ_t (φ > 1), where r_t is the current-period real interest rate observed via TIPS yields or inflation …

Andrew B. Abel · Stavros Panageas

The paper addresses two questions about government debt rollover. First, a positive question: what is the maximum ratio of government bonds to capital that can be sustained forever without any primary …

Clement Imbert · Gabriel Ulyssea

Does rural-urban migration increase or decrease urban informality, and through what mechanisms — and does the answer depend on the time horizon?

Qingen Gai · Naijia Guo · Bingjing Li · Qinghua Shi · Xiaodong Zhu

This paper asks why so much labor stays in low-productivity agriculture in developing countries, and treats the county-by-county rollout of China's New Rural Pension Scheme (NRPS) between 2009 and …

Giulia Brancaccio · Karam Kang

This paper investigates whether intermediaries in the U.S. municipal bond market strategically exploit product design to increase search frictions and, through that channel, capture rents. …

Yan Bai · Jing Zhang

A frictionless multi-country model implies no cross-country correlation between long-run savings and investment rates, so the Feldstein-Horioka finding really is a puzzle for it. Neither limited …

V. V. Chari · Patrick J. Kehoe · Ellen R. McGrattan

Staggered price-setting was long hoped to turn a short spell of exogenous price stickiness into a long spell of endogenous stickiness, and so into persistent output movements after a monetary shock. …

Michael Weber · Bernardo Candia · Hassan Afrouzi · Tiziano Ropele · Rodrigo Lluberas · Serafin Frache · Brent Meyer · Saten Kumar · Yuriy Gorodnichenko · Dimitris Georgarakos · Olivier Coibion · Geoff Kenny · Jorge Ponce

This paper uses randomized control trials (RCTs) applied over time in multiple countries to study whether the economic environment — specifically the level of inflation — affects how agents learn from …

Benjamin L. Collier · Cameron M. Ellis · Benjamin J. Keys

This paper estimates the shadow cost that consumers assign to pledging their primary residence as collateral, using administrative loan application and performance data from the U.S. Federal Disaster …

Maarten De Ridder · Basile Grassi · Giovanni Morzenti

Using matched data combining physical production records (EAP survey) and financial statements (FARE) for 147,403 firm-years across 18 two-digit manufacturing industries in France (2009–2019), the …

Andrew Garin · Dmitri Koustas · Carl McPherson · Samuel Norris · Matthew Pecenco · Evan K. Rose · Yotam Shem-Tov · Jeffrey Weaver

This paper estimates the causal effect of incarceration on employment, wage earnings, self-employment, and tax filing behavior using administrative criminal justice data linked to Internal Revenue …

Ana Cecília Fieler · Jonathan Eaton

Eaton and Fieler seek to reconcile two literatures that have advanced in parallel but remained at odds: (i) general equilibrium models of bilateral trade flows (the "gravity" tradition) and (ii) …

Alisdair McKay · Ricardo Reis

This paper builds a business-cycle model merging the standard incomplete-markets model with the New Keynesian model of nominal rigidities to quantify how much automatic fiscal stabilizers (progressive …

Eliana Carranza · Aletheia Donald · Florian Grosset-Touba · Supreet Kaur

This paper asks whether informal redistributive pressure — the social obligation to share earned income with kin and social networks — distorts labor supply in low-income communities. The authors …

Finn E. Kydland · Edward C. Prescott

This 1982 Econometrica paper by Finn Kydland and Edward Prescott builds an equilibrium growth model, fitted to post-war U.S. quarterly data, in which business-cycle fluctuations arise from technology …

Fumio Hayashi

Tobin's conjecture that investment depends on marginal q is derived from a general present-value-maximising firm problem with installation costs, giving an investment rule that depends on neither the …

Sushant Acharya · Keshav Dogra

Using an analytically tractable heterogeneous-agent New Keynesian model with CARA preferences and normally distributed idiosyncratic income risk, the paper shows that whether incomplete markets …

Jonas E. Arias · Juan F. Rubio-Ramírez · Daniel F. Waggoner

Structural vector autoregressions (SVARs) identified with sign restrictions are a widely used tool for estimating dynamic causal effects in macroeconomics. Critics—notably Baumeister and Hamilton …

Adrien Auclert · Bence Bardóczy · Matthew Rognlie · Ludwig Straub

Auclert, Bardóczy, Rognlie, and Straub introduce the "sequence-space Jacobian," a fast algorithm for computing the first-order derivatives of general-equilibrium heterogeneous-agent models with …