Annual Conference

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International Macroeconomics, Money & Banking

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May 2021

We examine the implications of capital flows and capital account policy for income distribution in a small open economy with heterogeneous agents and financial frictions. Banks engage in costly intermediation between household savings and entrepreneur investment. Our model predicts that inflow surge...
Keywords: capital flows, income distribution, Heterogeneous agents, Financial Frictions, small open economy.
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Annual Conference

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International Macroeconomics, Money & Banking

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May 2021

We develop a theory of exchange rate fluctuations arising from financial institutions’ demand for dollar liquid assets. Financial flows are unpredictable and may leave banks “scrambling for dollars.” Because of settlement frictions in interbank markets, a precautionary demand for dollar reserv...
Keywords: exchange rates, liquidity premia, monetary policy
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Annual Conference

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International Macroeconomics, Money & Banking

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May 2021

This paper studies the "Original sin redux" hypothesis in a two-country New Keynesian-DSGE framework. Emerging economies have been able to overcome the "original sin" and issue debt in local currency in recent years. We show that while this helps mitigate the vulnerability to external shocks, it doe...
Keywords: Foreign exchange, Currency mismatch, Emerging Economies
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Senior Fellows/Fellows

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Senior Fellows/Fellows

COVID-19 drove a mass social experiment in working from home (WFH). We survey more than 30,000 Americans over multiple waves to investigate whether WFH will stick, and why. Our data say that 20 percent of full workdays will be supplied from home after the pandemic ends, compared with just 5 percent ...
Keywords: COVID, working-from-home
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Senior Fellows/Fellows

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Senior Fellows/Fellows

Trade tensions between China and US have played an important role in swinging global stock markets but effects are difficult to quantify. We develop a novel trade sentiment index (TSI) based on textual analysis and machine learning applied on a big data pool that assesses the positive or negative to...
Keywords: Stock Returns, trade, sentiment, big data, neural network, machine learning
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