by Cecile Gaubert with Victor Couture, Jessie Handbury and Erik Hurst
by Emily Eisner
This project aims to understand the role of value-at-risk (VaR) constraints and bank risk-taking behavior in determining entry and exit into global asset markets. The model informs the aggregate risk of the global financial markets and informs macroeconomic dynamics that depend on financial frictions in intermediation. The project develops an open economy model of financial markets based on the closed economy model in Coimbra and Rey (2017). In the extended model, financial intermediaries, which are heterogeneous in their VaR constraint as in Coimbra and Rey (2017), have an opportunity to invest in foreign assets. The model predicts the risk-taking composition and international asset composition of financial intermediaries under different interest rate environments.
by Roman Zarate
The goal of this project is to study how competition and firm market power shape the productivity distribution and the way that firms locate into space. In particular, low productive firms sort into places in which they exert more market power, while high productive firms sort into locations in which it is easier for customers (workers) to substitute among suppliers (employers) facing more competition. This mechanism is relevant in the context of developing countries in which a large number of small, unproductive firms coexist with productive firms. My primary hypothesis is that since in developing countries it is hard to commute, firms exert more labor market power generating two effects. On the one hand, low productive firms survive, and on the other, productive firms don’t expand in some locations. To test this hypothesis, I would use the economic censuses in Mexico and assess the productivity and pro-competitive effects in the labor market of transport projects designed to move people within cities.
Development
International Trade & Development
by Mathieu Pedemonte
Development
International Trade & Development
by Nick Sander & Ganesh Natrij
This project seeks to understand the macroeconomic effects on a country receiving capital flows from abroad, in particular equity and debt (portfolio) inflows.
Capital flows
Financial Globalization