Methodology

Noah Williams

Williams asks whether the recurrent boom-bust dynamics of Minsky's financial instability hypothesis — "periods of stability lead to periods of instability" — can arise endogenously from a tractable …

Fatih Guvenen · Alisdair McKay · Conor Ryan

Guvenen, McKay, and Ryan estimate a stochastic income process for US male workers that simultaneously matches five empirical regularities from Social Security Administration administrative panel data …

Lukasz Rachel

This paper builds a tractable, fully analytical version of the workhorse macro-epidemiology ("econ-epi") model and uses it to characterize how susceptible individuals behave during a deadly epidemic, …

Andrew Y. Chen · Francisco Palomino

Chen and Palomino prove a general irrelevance theorem identifying when risk aversion and time-varying risk are irrelevant for key model dynamics in representative-agent macroeconomic models. The …

Peyman Firouzi Naeim · David W Johnston · Maryam Naghsh-Nejad

This paper examines how workplace environments shape the economic consequences that fall on mothers — but not fathers — when a child is diagnosed with cancer. The motivation is a gap in the …

Axel Gottfries

This paper resolves a long-standing theoretical impasse in labor search models: how to model wage bargaining when workers search on the job (OJS) and the quit rate depends on the wage. Shimer (2006) …

Réka Juhász · Shogo Sakabe · David E Weinstein

Research question and motivation: Why did the First Industrial Revolution (IR) spread to Meiji Japan—and to essentially no other non-Western country—during the first wave of globalization? The paper …

Antoine Bertheau · Rune Vejlin

Research question and motivation. On-the-job search models typically organize firms along a "job ladder" — a common ranking by workers of available jobs — but they disagree on whether the rung is best …

Lucas Corrêa-Dias · Jordan J Norris · Heitor S Pellegrina

Food production accounts for roughly one-third of global greenhouse gas (GHG) emissions, and richer nations contribute disproportionately through meat-intensive diets and input-intensive farming. This …

Mikael Carlsson · Alex Clymo · Knut-Eric Joslin

Carlsson, Clymo, and Joslin use Swedish manufacturing firm-level microdata for 1998–2013 to separately identify and characterize the cyclical behavior of physical productivity (TFPQ) shocks and demand …

Stephen Ayerst · Loren Brandt · Diego Restuccia

This paper asks how institutional distortions to factor markets affect not only the static allocation of inputs across farms but also the dynamic choices — crop selection and productivity-enhancing …

Eric Jondeau · Gregory Levieuge · Jean-Guillaume Sahuc · Gauthier Vermandel

This paper asks whether public subsidies to green-technology producers, financed by a carbon tax, can materially reduce the macroeconomic cost of reaching net-zero CO2 emissions by 2060. The …

Robert P Lieli · Augusto Nieto-Barthaburu

This paper develops a strategic model of point forecast production in environments where the forecast itself influences the outcome being predicted — what the authors call "forecasting with feedback." …

Rodrigo Adão · Costas Arkolakis · Federico Esposito

How do international trade shocks propagate through spatially connected regional labor markets, and how large are the general equilibrium effects that standard shift-share specifications miss? Adão, …

Flavien Moreau · Ludovic Panon

Moreau and Panon ask how much cartels cost the aggregate economy — in terms of both total factor productivity and welfare — and find the losses are considerably larger than the received wisdom from …

S. Borağan Aruoba · Thomas Drechsel

To study how monetary policy affects the economy, macroeconomists must isolate "shocks" — changes in interest rates that are not systematic responses to economic conditions. The paper proposes a new …

William A. Branch

Branch (2022) asks whether subjective consumer inflation expectations causally raise the inflation rate — a question whose empirical answer has been elusive despite its central role in New Keynesian …

Giorgio Chiovelli · Stelios Michalopoulos · Elias Papaioannou · Tanner Regan

Satellite nighttime lights (luminosity) are the dominant remote-sensing proxy for local economic conditions in low-income countries, yet their accuracy at fine spatial scales and over time has …

Holger Breinlich · Elsa Leromain · Dennis Novy · Thomas Sampson

Research question and motivation. How does import liberalization affect a country's export performance and welfare?

Yuriy Gorodnichenko · Ari Kutai · Rafi Melnick

Research question and motivation. How do firms form and update inflation expectations during a monetary-policy regime change and a transition from high/volatile inflation to a low, stable, …

Sebastian Ellingsen

This paper asks whether the location of economic activity adapts to changes in the location of trading opportunities, or whether historical patterns of trade permanently fix where cities emerge and …

Ariel Karlinsky · Moses Shayo

Karlinsky and Shayo ask which governments manipulate public information, in which direction, and by how much — questions that are normally intractable because the ground truth is unobservable. The …

Giovanni Cespa · Xavier Vives

The paper asks why market liquidity sometimes behaves in a stabilizing way (an illiquidity hike curbs liquidity demand and attracts liquidity supply) but on other occasions "evaporates when it is most …

Barton H. Hamilton · Andrés Hincapié · Emma C. Kalish · Nicholas W. Papageorge

This paper asks why medical innovation can widen health disparities even when it unambiguously improves health for everyone who takes it. The authors argue that the standard access-versus-preferences …

Davide Debortoli · Mario Forni · Luca Gambetti · Luca Sala

This paper measures how the inflation-unemployment tradeoff associated with monetary policy varies with both the sign of the monetary intervention (easing versus tightening) and the state of the …

Minsu Chang · Frank Schorfheide

This paper asks how conventional and informational monetary policy shocks affect the cross-sectional distributions of labor earnings, consumption, and financial income in the United States. The …

Vahagn Jerbashian

This paper estimates the elasticities of substitution between labor, information and communication technology (ICT) and intellectual property (IP) capital, and traditional capital using a nested …

Davin Chor · Edwin L.-C. Lai

This paper develops a tractable general equilibrium model of endogenous growth driven by cumulative innovation, and uses it to characterize optimal patent policy — both for patent breadth (via a …

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 …

Mohamad Adhami · Mark Bils · Charles I. Jones · Peter J. Klenow

The paper asks how much economic progress looks different when one applies a total utilitarian welfare criterion — counting every person's flow utility — rather than the standard per-capita …

Matthew Klepacz

This paper asks whether increases in aggregate volatility reduce the effectiveness of monetary policy by making aggregate prices more flexible. The motivation is concrete: policymakers worry that …

Weizheng Lai · Lixin Colin Xu · Li Yang

Research question and motivation: How do civil wars affect long-term development, and through which institutional mechanisms? The paper studies the Taiping Rebellion (1850-1864) in Qing China, one of …

Ferdinando Monte · Charly Porcher · Esteban Rossi-Hansberg

Monte, Porcher, and Rossi-Hansberg ask why remote work surged abruptly and permanently after COVID-19 despite information-technology advances raising it only marginally between 1980 and 2019, why the …

Scott French · Tess M. Stafford

A large empirical literature uses micro data to estimate the intertemporal elasticity of substitution (IES) of labor supply, a parameter crucial for understanding business-cycle fluctuations in hours …

Sakai Ando · Tamon Asonuma · Prachi Mishra · Alexandre Sollaci

Sovereign debt restructuring is a central tool for countries in debt distress, yet surprisingly little evidence exists on whether it actually reduces the debt-to-GDP ratio — the metric used in …

Esther Ann Bøler · Andreas Moxnes · Karen Helene Ulltveit-Moe

Firms that invest heavily in intangible assets — patents, R&D, software — face a structural financing disadvantage: intangibles offer limited collateral value to banks, so intangible-intensive firms …

Xavier Cirera · Diego Comin · Marcio Cruz

Research question and motivation: How sophisticated are the technologies establishments actually use, and how close are they to the world frontier? Traditional measures (since Ryan-Gross 1943 and …

Russell Cooper · Ozgen Ozturk

This paper investigates what drives the countercyclical dispersion of TFPR — total factor productivity measured in revenue terms — a pattern that is well documented empirically but poorly understood …

Alessandra Fenizia · Nicholas Li · Luca Citino

This paper studies the cost-effectiveness of targeted payroll tax reductions as a tool for stimulating labor demand among marginalized workers, using a natural experiment from Italy. The motivation is …

Corina Boar · Denis Gorea · Virgiliu Midrigan

Research question and motivation. A large literature argues that credit constraints are the dominant financial friction holding private businesses below their optimal scale, so that easing credit …

Jean-Félix Brouillette

Women accounted for only 3% of U.S. inventors in 1976 and still just 14% in 2023, a pace of convergence far slower than in law (3% to 49%) or medicine (6% to 46%) over the same period. Under the …

Hideki Nakamura · Masakatsu Nakamura · Shota Moriwaki

This paper asks a foundational question: can the economy-wide degree of automation be measured coherently from standard macroeconomic data, without relying on technology-specific proxies such as robot …

Julián Costas-Fernández · José-Alberto Guerra · Myra Mohnen

This paper asks whether proximity to transport infrastructure can sever the occupational tie between parents and children — a question with direct bearing on the debate over place-based versus …

Rüdiger Bachmann · Kai Carstensen · Stefan Lautenbacher · Manuel Menkhoff · Martin Schneider

A large literature shows that firms perceiving more uncertainty make more cautious intertemporal decisions (investment, hiring, price setting), but it is far less clear what makes firms uncertain in …

Horng Chern Wong

Why do some firms pay persistently higher wages for observably similar workers, and what role do firms' product-market power (monopoly/markups), labor-market power (monopsony/markdowns), and workers' …

Drago Bergholt · Fabio Canova · Francesco Furlanetto · Nicolò Maffei-Faccioli · Pål Ulvedal

The paper addresses what drove the post-COVID inflation surge in the United States and internationally. Before answering the substantive question, the authors identify and diagnose a methodological …

Peter Bednarek · Valeriya Dinger · Alison Schultz · Natalja von Westernhagen

Can banks effectively monitor their peers under asymmetric information? Effective peer monitoring matters for functioning interbank markets and, by implication, financial markets and the transmission …

Ryuichiro Izumi · Yang Li

Research question and motivation: Asset fire sales were a defining feature of the 2007-08 crisis, and post-crisis reforms (Basel III liquidity requirements, Money Market Mutual Fund reforms) were …

Daan Opschoor · Dick van Dijk · Philip Hans Franses

Research question and motivation. Since the Great Recession, quantifying downside risks to economic activity (rather than only expected outcomes) has become central for policymakers and investors.

Antoine L. Noël · Hongfei Sun

Noël and Sun build an information-based theory of capital structure designed to explain the diversity of observed firm financing behavior and the coexistence of distinct optimal financial contracts. …

Rafael Gerke · Sebastian Giesen · Daniel Kienzler

This paper revisits the "reversal puzzle" — the counterintuitive result, first documented by Carlstrom, Fuerst and Paustian (CFP, 2015), that in standard New Keynesian models the effect of forward …

Álvaro Fernández-Gallardo · Iván Payá

There is now broad consensus that monetary authorities should hold a financial-stability mandate and that macroprudential policy should be part of it, yet evidence on the macroeconomic effectiveness …

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.

Meltem Chadwick · Rennae Cherry · Jaqueson K. Galimberti

Inflation expectations measured from household surveys are central inputs to monetary policy, but roughly half of respondents to the RBNZ Household Inflation Expectations survey decline to answer the …

Takao Asano · Yusuke Osaki

How much to save is a central household financial decision, and uncertainty drives the "precautionary saving motive." The precautionary-saving literature has mostly studied one-dimensional …

Jasmina Hasanhodzic · Laurence J. Kotlikoff

Hasanhodzic and Kotlikoff ask a question prior work assumed away: how large is generational risk, and can pay-go Social Security actually mitigate it? Earlier studies (Diamond, Bohn, Krueger-Kubler, …

Pasqualina Arca · Gianfranco Atzeni · Luca G. Deidda

Research question and motivation: Under U.S. Chapter 7 bankruptcy, an individual entrepreneur has most unsecured debt discharged and only her non-exempt assets liquidated, producing an "insurance …

Thomas Winberry

A method for solving heterogeneous-agent models with aggregate shocks that replaces the infinite-dimensional distribution with a flexible parametric family, treats that family's moments as endogenous …

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

Chari, Kehoe, and McGrattan subject the popular structural-VAR (SVAR) procedure -- used by Gali (1999), Francis and Ramey (2005), and others to argue that technology shocks make hours fall, and …

Lawrence J. Christiano · Martin Eichenbaum · Robert Vigfusson

Christiano, Eichenbaum, and Vigfusson ask whether structural VAR (SVAR) methods reliably recover the dynamic response of hours worked to an identified shock, by generating artificial data from a …

Dmitry Taubinsky · Luigi Butera · Matteo Saccarola · Chen Lian

Linking the monthly Danish Consumer Expectations Survey to the Danish administrative registry, this paper shows that households' inflation forecasts move strongly and negatively with their own recent …

Finn E. Kydland · Edward C. Prescott

This 1990 Federal Reserve Bank of Minneapolis Quarterly Review paper argues that reporting business cycle facts without first assuming the data are generated by some probability model is a legitimate …

Thomas Herndon · M. Ash · Robert Pollin

A critical replication of Reinhart and Rogoff's "Growth in a Time of Debt" using their own working spreadsheet, which identifies three separate problems -- an unexplained exclusion of early post-war …

Lawrence H. Summers

Summers argues that the standard statistical tests used to support the Efficient Markets Hypothesis -- tests for serial correlation in excess returns, and for predictable excess returns conditional on …

Jeffrey C. Fuhrer

Standard optimising consumption models make spending jump on impact when a shock hits, which the data flatly contradict; replacing time-separable utility with habit formation gives consumers a motive …

Per Krusell · Anthony A. Smith, Jr.

In a calibrated stochastic growth model where a continuum of households face partially uninsurable employment risk and can self-insure only by holding aggregate capital, the macroeconomic aggregates …

Jonathan A. Parker

This 2011 *Journal of Economic Literature* forum essay by Jonathan Parker argues that as of early 2009 economists had no good measure of how government spending affects output specifically in a …

Yves Achdou · Francisco J. Buera · Jean-Michel Lasry · Pierre-Louis Lions · Benjamin Moll

Written explicitly to get mathematicians interested in macroeconomics, this review collects the systems of coupled nonlinear partial differential equations that arise once a macro model tracks a whole …

Christian Bayer · Ralph Luetticke

A solution method for discrete-time heterogeneous-agent models with aggregate risk that extends Reiter's perturbation approach by compressing the state space after the no-aggregate-risk stationary …

N. Gregory Mankiw

This 2006 essay by N. Gregory Mankiw argues that macroeconomics has always been pulled between two mindsets -- "engineers" who want to solve practical stabilization problems and "scientists" who want …

Vadym Lepetyuk · Lilia Maliar · Serguei Maliar · John B. Taylor

When a central bank announces a policy it will not implement for some time, households and firms respond straight away. This paper measures how much of a policy's effect arrives in that anticipation …