National Bureau of Economic Research Working Papers

The Latest NBER Working Papers

Latest articles

Offshoring and Inflation -- by Diego A. Comin, Robert C. Johnson

Did trade integration suppress inflation in the United States? We say no, in contradiction to the conventional wisdom. Our answer leverages two basic facts about the rise of trade: offshoring accounts for a large share of it, and it was a long-lasting, phased-in shock. Incorporating these features into a New Keynesian model, we show trade integration...

Bottom-up Markup Fluctuations -- by Ariel Burstein, Vasco M. Carvalho, Basile Grassi

We study markup cyclicality in a granular macroeconomic model with oligopolistic competition. We characterize the comovement of firm, sectoral, and economy-wide markups with sectoral and aggregate output following firm-level shocks. We then quantify the model’s ability to reproduce salient features of the cyclical properties of markups in French administrative...

Elections, Political Polarization, and Economic Uncertainty -- by Scott R. Baker, Aniket Baksy, Nicholas Bloom, Steven J. Davis, Jonathan A. Rodden

We examine patterns of economic policy uncertainty (EPU) around national elections in 23 countries. Uncertainty shows a clear tendency to rise in the months leading up to elections. Average EPU values are 13% higher in the month of and the month prior to an election than in other months of the same national election cycle, conditional on country effects,...

How Did Depositors Respond to COVID-19? -- by Ross Levine, Chen Lin, Mingzhu Tai, Wensi Xie

Why did banks experience massive deposit inflows during the first months of the pandemic? Using weekly branch-level data on interest rates and county-level data on COVID-19 cases, we discover that interest rates at bank branches in counties with higher COVID-19 infection rates fell by more than rates at other branches—even branches of the same bank...

The Micro Anatomy of Macro Consumption Adjustments -- by Rafael Guntin, Pablo Ottonello, Diego Perez

We study crises characterized by large adjustments of aggregate consumption through their microlevel patterns. We show that leading theories designed to explain aggregate consumption dynamics differ markedly in their cross-sectional predictions. While theories based on financial frictions predict that rich households with liquid assets should be able...

Dominant Currencies: How Firms Choose Currency Invoicing and Why it Matters -- by Mary Amiti, Oleg Itskhoki, Jozef Konings

Using new data on currency invoicing for Belgian firms, we analyze how firms make their currency choice, for both exports and imports, and the implications of this choice for exchange rate pass-through into prices and quantities. We derive our estimating equations from a theoretical framework featuring variable markups, international input sourcing,...

A Q-Theory of Banks -- by Juliane Begenau, Saki Bigio, Jeremy Majerovitz, Matias Vieyra

Five facts: (1) banks' market and book leverage diverged during the 2008 crisis, (2) Tobin's Q predicts future bank profitability, (3) neither book nor market leverage appears constrained, (4) banks have a market leverage target that is reached slowly, (5) pre-crisis, leverage was predominantly adjusted by liquidating assets. After the crisis, the adjustment...

Bank Liquidity Provision Across the Firm Size Distribution -- by Gabriel Chodorow-Reich, Olivier Darmouni, Stephan Luck, Matthew C. Plosser

Using loan-level data covering two-thirds of all corporate loans from U.S. banks, we document that SMEs (i) obtain much shorter maturity credit lines than large firms; (ii) have less active maturity management and therefore frequently have expiring credit; (iii) post more collateral on both credit lines and term loans; (iv) have higher utilization rates...

A Toolkit for Solving Models with a Lower Bound on Interest Rates of Stochastic Duration -- by Gauti B. Eggertsson, Sergey K. Egiev, Alessandro Lin, Josef Platzer, Luca Riva

This paper presents a toolkit to solve for equilibrium in economies with the effective lower bound (ELB) on the nominal interest rate in a computationally efficient way under a special assumption about the underlying shock process, a two-state Markov process with an absorbing state. We illustrate the algorithm in the canonical New Keynesian model, replicating...

Renegotiation in Debt Chains -- by Vincent Glode, Christian Opp

We develop a tractable model of strategic debt renegotiation in which businesses are sequentially interconnected through their liabilities. This financing structure, which we refer to as a debt chain, gives rise to externalities as a lender’s willingness to provide concessions to his privately-informed borrower depends on how this lender’s own liabilities...

Discover, share and read the best on the web

Subscribe to RSS Feeds, Blogs, Podcasts, Twitter searches, Facebook pages, even Email Newsletters! Get unfiltered news feeds or filter them to your liking.

Get Inoreader
Inoreader - Subscribe to RSS Feeds, Blogs, Podcasts, Twitter searches, Facebook pages, even Email Newsletters!