Journal of Monetary Economics

Kee-Youn Kang · Zijian Wang

Research question and motivation: Digital payments generate vast, high-frequency, transaction-level data that several central banks (Bank of Canada, Swiss National Bank, Eurosystem members) already …

David Berger · Thomas Hasenzagl · Kyle Herkenhoff · Simon Mongey · Eric A. Posner

Antitrust review of mergers has historically focused almost entirely on harm to consumers (product-market monopoly), ignoring harm to workers (labor-market monopsony). Following the July 2021 White …

Matthias Gnewuch · Donghai Zhang

Research question and motivation. Investment is a sizable and the most volatile component of aggregate GDP, so understanding the investment channel of monetary policy matters for policymakers.

Christoph Hambel · Frederick van der Ploeg

Research question and motivation: Central bankers, regulators, and investors increasingly worry about climate "transition risks" — abrupt shifts in climate policy, green technology breakthroughs, or …

Carlo Altavilla · Refet S. Gürkaynak · Rogier Quaedvlieg

This paper establishes basic facts about the external finance premium (EFP) faced by euro area firms borrowing from banks, and studies how monetary policy is transmitted to it. The EFP — the extra …

Ricardo Duque Gabriel

Research question and motivation. Public procurement accounts for roughly one-third of government spending (12.6% of GDP and 30% of total government expenditures in OECD countries in 2019).

Filippo Pallotti · Gonzalo Paz-Pardo · Jiri Slacalek · Oreste Tristani · Giovanni L. Violante

This paper measures the heterogeneous first-order welfare effects of the 2021-2023 inflation surge across households in the four largest euro area countries (Germany, France, Italy, Spain). …

Olga Goldfayn-Frank · Pascal Kieren · Stefan Trautmann

Standard survey-based measurement of inflation expectations relies on density forecasts in which respondents assign probabilities to pre-specified inflation bins; this method has been found to induce …

Jorge Miranda-Pinto · Daniel Murphy · Kieran James Walsh · Eric R. Young

A common observation from account-level bank data is that low-income, low-liquidity households often use additional income to repay debt rather than consume, and that household-level consumption is …

Daria Finocchiaro · Philippe Weil

Finocchiaro and Weil ask whether financial development necessarily promotes long-run economic growth, or whether congestion externalities in R&D markets can offset — and even reverse — the growth …

Jess Benhabib · Feng Dong · Pengfei Wang · Zhenyang Xu

Why do corporate defaults cluster in recurring episodes rather than occurring smoothly? The paper asks whether observable fundamental factors — firm characteristics and macroeconomic variables — are …

Boyan Jovanovic · Peter L. Rousseau

AI can improve decisions, raise firm productivity, and accelerate human capital growth through its effect on signal quality in problem-solving tasks, but the consequences are heterogeneous across the …

Paolo Giordani

This 2004 Journal of Monetary Economics paper by Paolo Giordani offers an analytical and empirical alternative to the Sims (1992) forward-looking-information explanation of the "price puzzle" — the …

Christian Bayer · Ralph Luetticke · M. Weiss · Yannik Winkelmann

This paper introduces the Distributional Endogenous Gridpoint Method (DEGM), a novel numerical technique for solving the distributional dynamics that arise in heterogeneous agent macroeconomic models. …

Ping Wang · Tsz-Nga Wong

Wang and Wong develop a continuous-time labor-search model to assess the dynamic effects of generative AI (GenAI) on labor productivity and unemployment. The paper is motivated by conflicting …

Vitaly M. Bord · Agnes Kovacs · Patrick Moran

Should regulators restrict banks from proactively raising credit card limits using machine-learning algorithms, and if so, how? The paper asks: to what extent are bank-initiated credit limit increases …

Wouter J. den Haan · Steven W. Sumner · Guy M. Yamashiro

This 2007 Journal of Monetary Economics paper by Wouter den Haan, Steven Sumner, and Guy Yamashiro asks whether the three main categories of U.S. bank loans -- commercial and industrial (C&I), real …

Merike Kukk · Jan Toczynski · Christoph Basten

Households are exposed to different rates of inflation because they buy different things, and using anonymised quarterly bank-account records for 89,507 individuals at one of Estonia's leading …

Almut Balleer · Georg Duernecker · Susanne Forstner · Johannes Goensch

The paper asks two questions: (1) How do workers' biased expectations about job finding and job separation shape the labor market equilibrium and wages? (2) Are differences in expectation biases …

Minsu Chang · Hanbaek Lee

This paper investigates the fiscal multiplier of infrastructure investment, specifically by incorporating firm-level investment decisions — a dimension absent from prior literature. The central …

Valentina Bruno · Hyun Song Shin

Bank leverage is the linchpin of a risk-taking channel through which monetary policy travels across borders: in a pre-crisis quarterly VAR a tighter US policy rate raises the VIX, lowers broker-dealer …

Francesco Lippi · Elia Moracci

Lippi and Moracci (2026) ask how euro area households choose between cash and card payments, and whether existing theoretical models can explain observed behavior. They draw on ECB payment diary …

Michael Ehrmann · Phillipp Gnan · Kilian Rieder

This paper investigates the economics of monetary policy leaks — anonymous disclosures of confidential information by insiders to the media — focusing on three central questions: (1) Are leaks random …

Manuel Amador · Christopher Phelan

How does noise in the mapping from central bank actions to realized inflation affect the existence and character of reputational equilibria in monetary policy? Specifically, can a central bank that …

Marvin Goodfriend

Classifying Federal Reserve crisis-era interventions into monetary policy, credit policy, and interest-on-reserves policy, Goodfriend argues that only "Treasuries only" monetary policy is fiscally …

Francesco Giovanardi · Matthias Kaldorf

This paper asks two related questions about the intersection of climate policy and bank capital regulation. First, can differentiated bank capital requirements — imposing higher equity charges on …

J. Carter Braxton

This comment, written by J. Carter Braxton (University of Wisconsin), discusses the paper "Artificial Intelligence and Technological Unemployment" by Wang and Wong (2025), which develops and …

Miao Ben Zhang

This paper is a published comment by Miao Ben Zhang (USC Marshall School of Business) on Mihet, Rishabh, and Gomes (2025), "Is It AI or Data That Drives Market Power?" Zhang identifies three …

Christoph Grosse-Steffen · Laura Pagenhardt · Malte Rieth

A central debate in fiscal policy is whether fiscal rules—numerical constraints on budget deficits or debt levels—impair a government's ability to respond to adverse economic shocks, creating a …

Ippei Fujiwara · Kiminori Matsuyama

Fujiwara and Matsuyama ask whether the well-documented flattening of the New Keynesian Phillips curve (NKPC) and the concurrent rise in market concentration and markup rates are causally linked or …

Emil Holst Partsch · Ivan Petrella · Emiliano Santoro

Consumer durables account for a disproportionately large share of household expenditure fluctuations despite their small share of total private consumption. Two stylized facts motivate the paper: (1) …

Andrea Chiavari

This paper asks how rising returns to scale in production contributed to three concurrent U.S. secular trends since 1980: declining business dynamism, rising markups, and growing firm expenditures on …

Andreas Hornstein · Marios Karabarbounis · André Kurmann · Etienne Lalé · Lien Ta

This paper isolates the disincentive effects of pandemic unemployment insurance (UI) benefits on employment recovery, separating them from the simultaneously operating stimulative (demand) effects …

Anastasiia Antonova · Gernot J. Müller

This paper asks how governments should optimally adjust sector-specific taxes in response to sectoral shocks when monetary policy cannot be tailored to individual sectors. The authors work within a …

Mariano Kulish · James Morley · Tim Robinson

This 2017 Journal of Monetary Economics paper by Mariano Kulish, James Morley, and Tim Robinson addresses a practical problem in Bayesian estimation of DSGE models: once the policy rate is pinned at …

Brent Bundick · Isabel Cairó · Nicolas Petrosky-Nadeau

This paper investigates whether and how assumptions about household and firm expectations alter the macroeconomic implications of asymmetries commonly embedded in macroeconomic models. Specifically, …

Ming Zeng · Guihai Zhao

What drives the joint historical dynamics of the term structure of equity yields and nominal bond yields — and can a single unified equilibrium model explain the procyclical equity yield slope, the …

Jordan Roulleau-Pasdeloup

The paper asks whether an explicit, global, closed-form solution exists for the consumption function in the standard income fluctuation problem with a borrowing constraint and constant income, a …

Kirstin Hubrich · Yves S. Schüler · Daniel Waggoner

This paper investigates the role of leverage of financial institutions in amplifying the transmission of financial shocks to the macroeconomy, with particular attention to whether that amplification …

Richard Audoly

How do aggregate economic fluctuations reallocate workers across the firm productivity distribution over the business cycle? In particular, to what extent do recessions impede workers' movement up the …

Galina Vereshchagina

This paper quantifies how idiosyncratic firm-level risk affects aggregate output, TFP, and firm life-cycle growth in an environment where firm productivity evolves endogenously through risky …

Hanno Lustig · Christopher Sleet · Şevin Yeltekin

Solving a Ramsey model of optimal fiscal and monetary policy in which the government can finance itself only with non-contingent nominal bonds of various maturities, this paper finds that optimal …

Sophocles N. Brissimis · Nicholas S. Magginas

This 2006 Journal of Monetary Economics paper by Sophocles Brissimis and Nicholas Magginas asks whether augmenting a standard monetary VAR with forward-looking information can resolve the "price …

Alessandro Moro · Valerio Nispi Landi

Moro and Nispi Landi develop FraNK, a multi-country New Keynesian model designed to study geoeconomic fragmentation — defined, following Aiyar et al. (2023), as a policy-driven reversal of economic …

Craig Burnside · Martin Eichenbaum · Sergio Rebelo

This paper builds a general-equilibrium model in which a currency crisis is triggered by prospective government deficits and shows that governments finance the resulting fiscal costs mainly through …

Daniel Barth · R. Jay Kahn

The U.S. Treasury market is the deepest and most liquid fixed-income market in the world, yet in March 2020 it experienced unprecedented dysfunction—widening bid-ask spreads, skyrocketing repo rates, …

Karam Jo · Seula Kim

Jo and Kim ask two related questions: (1) How do firms use different types of innovation when learning others' technology takes time? (2) How does this process alter the aggregate implications of firm …

David O. Cushman · Tao Zha

This 1997 Journal of Monetary Economics paper by David Cushman and Tao Zha addresses the "exchange rate puzzle" and "price puzzle" that plague conventional recursive (Choleski) VAR studies of monetary …

Jeffery D. Amato · Thomas Laubach

Adding habit formation in consumption to an optimising sticky-price model changes both the IS curve and the Phillips curve, makes the variance of output itself -- not only the output gap -- …

Sergio Villalvazo

This paper studies the cross-sectional dimension of Fisher's (1933) debt-deflation mechanism as it operates during Sudden Stop crises — episodes characterized by large, abrupt reversals in the current …

Fabio Ghironi · Daisoon Kim · Galip Kemal Ozhan

Sanctions are increasingly used as an instrument of economic statecraft, yet their macroeconomic consequences—especially the transitional dynamics and their effects on business cycles—are poorly …

François Gourio · Anil K. Kashyap

Plant-level data from Chile and the U.S. show that swings in aggregate investment come almost entirely from changes in how many establishments are having an investment spike, not how big those spikes …

Serdar Birinci · Fatih Karahan · Yusuf Mercan · Kurt See

The paper asks two related questions: (1) How much, and through which channels, do employer-to-employer (EE) worker transitions affect macroeconomic outcomes — particularly inflation? (2) What is the …

Chun-Che Chi

This paper studies how the lender structure of external debt — specifically, the degree to which a borrowing country's external debt is concentrated among a small number of large lenders — affects …

Jonathan Créchet · Etienne Lalé · Linas Tarasonis

The paper asks: what are the sources of cross-country differences in aggregate employment across European economies, and which types of worker flows — between employment (E), unemployment (U), and …

Zhesheng Qiu · Yicheng Wang · Le Xu · Francesco Zanetti

This paper studies the design of monetary policy in a multi-sector small open economy with domestic input-output linkages and cross-border production networks, under nominal price rigidities in …

S. Mahdi Barakchian · Christopher Crowe

This 2013 Journal of Monetary Economics paper by S. Mahdi Barakchian and Christopher Crowe argues that the standard toolkit for identifying monetary policy shocks -- recursive VARs …

Kenneth N. Kuttner

This 2001 Journal of Monetary Economics paper by Kenneth N. Kuttner addresses a basic errors-in-variables problem in earlier event studies of monetary policy and interest rates (notably Cook and Hahn …

Luis G. Hernández-Román

This paper employs a proxy structural VAR model to examine the effects of global supply chain (GSC) shocks on U.S. macroeconomic variables and the Federal Reserve's historical response, and evaluates …

John H. Cochrane

Cochrane argues that the fiscal theory of the price level rests on a valuation equation, not a budget constraint -- nominal government debt is priced like a claim on future government surpluses, …

Camelia Minoiu · Rebecca Zarutskie · Andrei Zlate

Minoiu, Zarutskie, and Zlate ask whether participation in the Main Street Lending Program (MSLP)—a Federal Reserve emergency facility launched in mid-2020 to channel credit to small and mid-sized …

Paolo Gelain · Marco Lorusso

This paper estimates the effect of oil price fluctuations on US banking variables using a Bayesian SVAR with sign restrictions following Baumeister and Hamilton (2019). Oil market shocks that lead to …

Christopher J. Erceg · Dale W. Henderson · Andrew T. Levin

In an optimizing-agent model where both wages and prices are set in staggered Calvo contracts, monetary policy cannot reach the allocation that would prevail under fully flexible wages and prices, …

Christopher Gust · Edward Herbst · David López-Salido

Central banks must set policy under uncertainty about how private-sector expectations form, which changes how monetary policy transmits to output and inflation. This paper studies optimal …

Yuliya Rychalovska · Sergey Slobodyan · Rafael Wouters

This paper asks whether Survey of Professional Forecasters (SPF) data can be efficiently integrated into medium-scale DSGE models, and whether models with imperfectly rational expectations based on …

Poorya Kabir · Eugene Tan · Ia Vardishvili

Standard measures of capital allocative efficiency—based on the dispersion of the average revenue product of capital (ARPK)—are severely biased when capital utilization is endogenous. When utilization …

Ayşe İmrohoroğlu · Çağrı S. Kumru · Jiu Lian

This paper asks whether racial differences in labor income can simultaneously explain both the crime gap and the wealth gap between Black and White individuals in the United States. The authors build …

Robert E. Lucas, Jr.

Writing for the 30th anniversary of Milton Friedman and Anna Schwartz's *A Monetary History of the United States, 1867-1960*, Lucas argues the book's lasting contribution is a normative one -- it …

Henrique S. Basso · Omar Rachedi

Basso and Rachedi investigate how robot adoption influences inflation dynamics — specifically, whether the surge in automation during the 2000s and 2010s can explain the muted sensitivity of inflation …

Robert J. Barro · David B. Gordon

This 1983 Journal of Monetary Economics paper by Robert Barro and David Gordon shows that a monetary authority acting with full discretion each period will generate more inflation on average than one …

Federico Mandelman · Mishita Mehra · Hewei Shen

High-skilled immigration policy frictions—particularly the H-1B visa lottery, fixed annual cap, and associated compliance costs—impose well-known burdens on firms, but their disproportionate impact on …

James Bullard · Alex Grimaud · Isabelle Salle · Gauthier Vermandel

Why did the 2021–2023 US inflation surge end in a soft landing — disinflation without a major recession — while the Volcker disinflation of 1979–1987 required substantial output losses? And was the …

Julio L. Ortiz

This paper investigates the macroeconomic consequences of widespread just-in-time (JIT) inventory management, documenting a fundamental trade-off: JIT raises firm profitability and reduces micro-level …

Agneta Berge · Ann-Sofie Kolm · Per Krusell

This paper asks whether a labor market with search-and-matching frictions and firms producing under decreasing returns to labor is better characterized by in-house hiring with intra-firm wage …

Guillermo A. Calvo

This 1983 Journal of Monetary Economics paper by Guillermo Calvo builds a model of staggered price-setting that is more analytically tractable than the earlier discrete-contract-length models of …

Francesco Saverio Gaudio

This paper documents a puzzle for canonical limited-participation models: when U.S. stock market participation rose from 31.6% to 53% between 1989 and 2007—a period also characterized by the Great …

Glenn D. Rudebusch

Estimated Taylor-type policy rules typically find the Fed adjusts the funds rate only 20-30 percent of the way to its desired level each quarter, widely read as deliberate "interest rate smoothing" -- …

Vasco Cúrdia · Michael Woodford

Extending a New Keynesian model to give the central bank's balance sheet a genuine role in equilibrium determination, the authors distinguish three independent dimensions of monetary policy -- the …

Xiaoming Li · Zheng Liu · Yuchao Peng · Zhiwei Xu

This paper asks how changes in the composition (not the size) of Chinese local government debt influence bank risk-taking, credit allocation between privately owned enterprises (POEs) and state-owned …

Rajnish Mehra · Edward C. Prescott

This 1985 Journal of Monetary Economics paper by Rajnish Mehra and Edward C. Prescott documents that over 1889-1978 U.S. equities earned about seven percent real return per year on average while …

Edward Nelson

This 2003 Journal of Monetary Economics paper by Edward Nelson (Bank of England) asks whether the New Keynesian models that had displaced money-focused monetarist analysis by the early 2000s still …

Moritz Kuhn · Iourii Manovskii · Xincheng Qiu

This paper asks why unemployment rates differ so persistently across local labor markets, and what role job creation and job destruction play in generating those differences. The authors document a …

Jesper Böjeryd · Roine Vestman · Björn Tyrefors · Dany Kessel

This paper estimates a causal housing wealth effect on consumption using a quasi-natural experiment in Stockholm, Sweden. The identification exploits an unanticipated political decision — announced in …

S. Borağan Aruoba · Thomas Drechsel

This 2024 Journal of Monetary Economics paper by S. Borağan Aruoba and Thomas Drechsel asks why the aggregate U.S.

Nils H. Lehr · Pascual Restrepo

Leading AI firms such as OpenAI and Anthropic publicly claim dual mandates of profit and social welfare, raising the question of whether—and how—a social mandate should change their pricing and …

Marta García-Rodríguez

This paper develops a Mortensen-Pissarides (DMP) search and matching model with internally rational (IR) agents who hold subjective beliefs about wages rather than perfect knowledge of the Nash …

Jonas E. Arias · Dario Caldara · Juan F. Rubio-Ramírez

This 2019 Journal of Monetary Economics paper by Jonas Arias, Dario Caldara, and Juan Rubio-Ramírez proposes identifying monetary policy shocks in a structural VAR by placing sign and zero …

Urban Jermann · Haotian Xiang

The rapid proliferation of cryptocurrency tokens—roughly 10,000 outstanding with a total market capitalization around $3 trillion as of early 2024—raises new questions about the design of token …

Ding Dong · Zheng Liu · Pengfei Wang

Firm-level evidence shows that recessions are characterized not just by aggregate downturns but by a sharp rise in turbulence—a reshuffling of firms' productivity rankings in which high-productivity …

Karlye Dilts Stedman · Andrew Hanson

The paper asks why unconventional monetary policy (UMP) spillovers from the European Central Bank (ECB) to the U.S. Treasury yield curve vary so substantially over time, and whether the time-varying …

Federico Ravenna

This 2007 Journal of Monetary Economics paper by Federico Ravenna asks a purely methodological question with direct consequences for structural VAR (SVAR) practice: under what conditions does a DSGE …

Sebastian Heise · Jeremy Pearce · Jacob P. Weber

Which measures of labor market tightness best predict nominal wage inflation, and do standard measures such as the unemployment rate and the vacancy-to-unemployment ratio capture the relevant slack? …

Harald Uhlig

This 2005 Journal of Monetary Economics paper by Harald Uhlig proposes an "agnostic" sign-restriction procedure for identifying monetary policy shocks in a VAR, designed to test rather than assume the …

John H. Cochrane

Even after monetary policy shocks are "correctly" identified in a VAR, Cochrane argues a further, purely theoretical identifying assumption -- whether anticipated money can affect output -- is needed …

Michael D. Bordo · Carlos A. Végh

Comparing Argentina's high, chronic nineteenth-century inflation to the United States' price stability, this paper argues the divergence reflects not differing policy competence but the different …

Nicholas Kozeniauskas

The entrepreneurship rate in the United States—defined as the share of the labor force who own and actively manage a business with at least ten employees—declined by 26% between 1987 and 2015, a …