# Macroeconomics Commons™

Articles 1 - 21 of 21

## Full-Text Articles in Macroeconomics

A Pilot Study Of Uncertainty In Income Tax Forecasts, Andrew Joung, Benjamin Lockwood, Alex Rees-Jones Oct 2018

#### A Pilot Study Of Uncertainty In Income Tax Forecasts, Andrew Joung, Benjamin Lockwood, Alex Rees-Jones

##### Population Center Working Papers (PSC/PARC)

How confidently can taxpayers forecast the tax bill that they will face? We asked survey respondents to provide both point estimates and subjective probability distributions of items from the tax return that they will submit the following April. In a pilot study, consisting of a sample of 188 participants from Amazon Mechanical Turk, we find evidence of substantial uncertainty over both the final tax and its determinants. We discuss the implications of this uncertainty for both tax policy and economic modeling.

Efficacy Of Blended Finance In Climate Change Infrastructure Projects, Christian A. Butts Jan 2018

#### Efficacy Of Blended Finance In Climate Change Infrastructure Projects, Christian A. Butts

##### Wharton Research Scholars

As the conversations surrounding climate change prevention and Sustainable Development Goal (SDG) financing grow in importance in the 21st century, so too do the conversations around the intersections of solutions around the topics. Blended financing has been utilized in several different forms over the past decade or so to tackle the largest problems in the global economy set out by the United Nation’s SDGs. While the tool has been leveraged for several of these Sustainable Development Goals, it has been particularly useful in attracting private investment for environmental sustainability-focused projects via the programs in place at several of ...

21st Century Chinese Art Market Boom, Ayca Deniz Ergin Jan 2018

#### 21st Century Chinese Art Market Boom, Ayca Deniz Ergin

##### Summer Program for Undergraduate Research (SPUR)

This research paper provides a detailed analysis of how China has become the fastest growing art market around the world. How did the economic development in China led the country to the top in recent years, in contrast to its Western competitors? What is China’s role in the global art market scene? What changes have been made, in a socialist system, to accommodate foreign investors and what future changes should be made to sustain its growth?

Through focusing on the correlation between economic growth and art market expansions, this research develops the relationship through referencing various quantitative and qualitative ...

Up, Down And Reciprocal: The Dynamics Of Intergenerational Transfers, Family Structure And Health In A Low-Income Context, Collin F. Payne, Luca Maria Pesando, Hans-Peter Kohler Jun 2017

#### Up, Down And Reciprocal: The Dynamics Of Intergenerational Transfers, Family Structure And Health In A Low-Income Context, Collin F. Payne, Luca Maria Pesando, Hans-Peter Kohler

##### Population Center Working Papers (PSC/PARC)

In the absence of well-functioning public transfer systems and safety nets, the family acts as the key provider of income and support through the intergenerational redistribution of resources. In this paper we use micro-level longitudinal data and a mix of methodologies to document the lifecycle patterns of financial transfers in a rural, sub-Saharan African population. Underneath a well-established age-pattern of intergenerational transfers in which transfer patterns change according to broad stages of the economic life cycle, our analyses document significant heterogeneity and fluidity: Intergenerational transfers are variable and reverse their direction, with individuals moving between the provider and recipient states ...

Volatility, The Macroeconomy, And Asset Prices, Ravi Bansal, Dana Kiku, Ivan Shaliastovich, Amir Yaron Dec 2014

#### Volatility, The Macroeconomy, And Asset Prices, Ravi Bansal, Dana Kiku, Ivan Shaliastovich, Amir Yaron

##### Finance Papers

How important are volatility fluctuations for asset prices and the macroeconomy? We find that an increase in macroeconomic volatility is associated with an increase in discount rates and a decline in consumption. We develop a framework in which cash flow, discount rate, and volatility risks determine risk premia and show that volatility plays a significant role in explaining the joint dynamics of returns to human capital and equity. Volatility risk carries a sizable positive risk premium and helps account for the cross section of expected returns. Our evidence demonstrates that volatility is important for understanding expected returns and macroeconomic fluctuations.

Perverse Nudges: Minimum Payments And Debt Paydown In Consumer Credit Cards, Jialan Wang, Benjamin J. Keys Apr 2014

#### Perverse Nudges: Minimum Payments And Debt Paydown In Consumer Credit Cards, Jialan Wang, Benjamin J. Keys

##### Wharton Public Policy Initiative Issue Briefs

Credit card minimum payments can act as an “anchor” that causes consumers to pay less of their debt than they otherwise would, leading to higher balances and interest costs, lower credit card scores, increased bankruptcy risks, and in the aggregate, suboptimally high levels of debt in the macro-economy. Policy “nudges,” which aim to increase the monthly amount that individuals pay on their credit card debt, have had mixed results.

Consumer Spending And The Economic Stimulus Payments Of 2008, Jonathan A. Parker, Nicholas S. Souleles, David S. Johnson, Robert Mcclelland Oct 2013

#### Consumer Spending And The Economic Stimulus Payments Of 2008, Jonathan A. Parker, Nicholas S. Souleles, David S. Johnson, Robert Mcclelland

##### Finance Papers

We measure the change in household spending caused by receipt of the economic stimulus payments of 2008, using questions added to the Consumer Expenditure Survey and variation from the randomized timing of disbursement. Households spent 12-30 percent (depending on specification) of their payments on nondurable goods during the three-month period of payment receipt, and a significant amount more on durable goods, primarily vehicles, bringing the total response to 50-90 percent of the payments. The responses are substantial and significant for older, lower-income, and home-owning households. Spending does not vary significantly with the method of disbursement (check versus electronic transfer).

Macroeconomic Fluctuations And Poverty, Philip N. Jefferson, Kunhee Kim Nov 2012

#### Macroeconomic Fluctuations And Poverty, Philip N. Jefferson, Kunhee Kim

##### Health Care Management Papers

This article examines the dynamic relationship between macroeconomic performance and measures of poverty in the United States. The article is organized as follows. Section 2 presents insights on the relationship between poverty and macroeconomic performance that emerge from the literature. The emphasis is on empirical studies from 1986 to 2011. Section 3 provides a snapshot of the change in poverty over National Bureau of Economic Research-dated recessions for a variety of poverty measures. Section 4 uses vector autoregressions (VARs) to characterize the response of poverty to innovations in various social indicators and measures of macroeconomic performance. Section 5 expands the ...

Essays In Quantitative Economics And International Finance, Serhiy Stepanchuk Aug 2011

#### Essays In Quantitative Economics And International Finance, Serhiy Stepanchuk

##### Publicly Accessible Penn Dissertations

This dissertation uses quantitative dynamic models to study two separate questions in international finance and international labor markets.

In Chapter 2, we build a two-country two-good incomplete markets general equilibrium model of international portfolio choice, and use it to study global imbalances, in particular the large negative net foreign asset position, and international portfolio composition of the United States. We show that the exorbitant privilege'' of the US (ability to borrow in domestic currency) and lower volatility of macroeconomic shocks that the US has experienced since mid-80s can account for a large part of the negative net foreign position of ...

A Macroeconomic Approach To A Firm's Capital Structure, Mitsuru Katagiri Aug 2011

#### A Macroeconomic Approach To A Firm's Capital Structure, Mitsuru Katagiri

##### Publicly Accessible Penn Dissertations

In this paper, I investigate the logic behind cross sectional dispersion of firm's capital structure. I incorporate the trade off between tax benefits and financial distress costs into a dynamic general equilibrium model with heterogeneous firms and their endogenous entry/exit, and compute an equilibrium firm distribution.

The main findings are summarized as follows. First, I find that the equilibrium distribution approximates the dispersion of firms' capital structure well. Second, I find that it simultaneously accounts for the relationship of capital structure to profitability \textit{and} firm size. The key mechanisms are the difference in responses to persistent and ...

Essays On The Western Labor Markets, Hans A. Holter Aug 2011

#### Essays On The Western Labor Markets, Hans A. Holter

##### Publicly Accessible Penn Dissertations

In Chapter 2, "Accounting for Cross-Country Differences in Intergenerational Earnings Persistence: The Impact of Taxation and Public Education Expenditure," I study the determinants of cross-country differences in intergenerational earnings persistence between fathers and sons. Western economies exhibit substantial differences in the degree of intergenerational earnings persistence between fathers and sons. Earnings persistence is relatively low in Northern Europe and relatively high in the US, Britain, and Southern Europe. In this chapter I first document that there is a strong negative cross-country correlation between intergenerational earnings persistence and tax progressivity, and intergenerational earnings persistence and public expenditure on tertiary education. I ...

Essays On The Macroeconomics Of Income Inequality, Serdar Ozkan May 2011

#### Essays On The Macroeconomics Of Income Inequality, Serdar Ozkan

##### Publicly Accessible Penn Dissertations

This thesis consists of three chapters, each of which focuses on different aspects of economic inequality.

First, we investigate the differences in wage inequality between the United States and continental European countries (CEU). Wage inequality has been significantly higher in the US compared to the CEU since the 1970s. Moreover, this inequality gap has further widened in the last three decades. We study the role of redistributive institutions, particularly progressive income tax policies, in understanding these facts in a human capital accumulation setting.

Second, we focus on statistical modeling of labor income risk over the life cycle. Using the PSID ...

May 2011

#### Essays In Macroeconomic Dynamics And The Financial Market, Wen Yao

##### Publicly Accessible Penn Dissertations

This thesis explores the important link between macroeconomic dynamics and the financial sector. The first essay studies Epstein-Zin preferences, which are found to be able to account for both aggregate macroeconomic dynamics and asset prices. In the first essay, I compare different solution methods for computing dynamic stochastic general equilibrium (DSGE) models with Epstein-Zin preferences and stochastic volatility. I show that perturbation methods are an attractive approach for computing this class of problems. The second essay emphasizes the importance of frictions in the financial market on real economic activities. The model studies the international business cycle co-movements when financial frictions ...

Fiscal Policy, Default And Emerging Market Business Cycles, Omer K. Parmaksiz Aug 2010

#### Fiscal Policy, Default And Emerging Market Business Cycles, Omer K. Parmaksiz

##### Publicly Accessible Penn Dissertations

Developing country fiscal policy outcomes documented in data point to stark differences compared with developed ones. Most prominent difference is the excessive volatility of government consumption and transfer payments and their positive correlation relative to output. This seemingly non-optimal behavior is puzzling since it is in contrast with standard theory prescriptions and likely to contribute to aggregate volatility. To study the possible roots of this I build a model by incorporating a detailed explicit fiscal sector to what is otherwise a standard sovereign default setup. The environment I define is one of incomplete markets that resembles small open developing economies ...

Financial Frictions, Propagation Of Shocks, And Macroeconomic Volatility, Cristina Fuentes-Albero May 2010

#### Financial Frictions, Propagation Of Shocks, And Macroeconomic Volatility, Cristina Fuentes-Albero

##### Publicly Accessible Penn Dissertations

I study the evolution of aggregate volatility in the US during the postwar period by assessing the relative role played by financial shocks, technological progress, and changes in the financial system. Balance-sheet variables of firms have been characterized by greater volatility since the early 1970s. This Financial Immoderation has coexisted with the so-called Great Moderation, which refers to the slowdown in volatility of real and nominal variables since the mid 1980s. In the second chapter, I study the moderation in real variables calibrating a real business cycle model with two technology shocks. I consider several statistical specifications for technological progress ...

May 2010

#### Essays In Estimation Of Dynamic Stochastic General Equilibrium Models, Maxym Kryshko

##### Publicly Accessible Penn Dissertations

Dynamic factor models (DFM) and dynamic stochastic general equilibrium (DSGE) models are widely used for empirical research in macroeconomics. The empirical factor literature argues that the co-movement of large panels of macroeconomic and financial data can be captured by relatively few common unobserved factors. Similarly, the dynamics in DSGE models are often governed by a handful of state variables and exogenous processes such as latent preference and/or technology shocks. A general topic of this dissertation is the estimation of DSGE models on a rich panel of macroeconomic and financial data by combining a DSGE with a dynamic factor model ...

Essays In Information Economics, Jonathan T. Pogach May 2010

#### Essays In Information Economics, Jonathan T. Pogach

##### Publicly Accessible Penn Dissertations

This dissertation is composed of three essays considering the role of private information in economic environments. The first essay considers efficient investments into technologies such as auditing and enforcement systems that are designed to mitigate information and enforcement frictions that impede the provision of first best insurance against income risk. In the model, the principal can choose a level of enforceability that inhibits an agent's ability to renege on the contract and a level of auditing that inhibits his ability to conceal income. The dynamics of the optimal contract imply an endogenous lower bound on the lifetime utility of ...

Essays On The Macroeconomics Of Incomplete Information, Leonardo Melosi May 2010

#### Essays On The Macroeconomics Of Incomplete Information, Leonardo Melosi

##### Publicly Accessible Penn Dissertations

In the first chapter, I develop and estimate a dynamic general equilibrium model with imperfectly informed firms in the sense of Woodford (2002). The model has two aggregate shocks: a monetary policy shock and a technology shock. Firms observe idiosyncratic noisy signals about these shocks and face strategic complementarities in price setting. In this environment, agents' "forecasting the forecasts of others" can produce realistic dynamics of model variables, with associated highly persistent real effects of monetary shocks and delayed effects of such shocks on inflation. The paper provides a full Bayesian analysis of the model, revealing that it can capture ...

Essays On The Macroeconomics Of Labor Markets, Sergiy Stetsenko May 2010

#### Essays On The Macroeconomics Of Labor Markets, Sergiy Stetsenko

##### Publicly Accessible Penn Dissertations

This dissertation consists of two essays studying macroeconomics questions about labor markets. The research in this document is separated into chapters that study distinct features of aggregate labor market outcomes.

The first essay documents the change in behavior of fertility rate at business cycle frequencies in the United States between the 1970s and 1990s and shows how the cyclical and secular properties of fertility can be used to distinguish among several proposed theories that account for the rise in labor force participation of married mothers. The model, in which households make fertility, female labor force participation and asset accumulation decisions ...

#### Essays On Macroeconomics And Labor Markets: Understanding Idiosyncratic And Aggregate Shocks, Se Kyu Choi

##### Publicly Accessible Penn Dissertations

This dissertation studies the importance of shocks in understanding economic outcomes, both at the aggregate and at the individual levels. The research in this document is separated into chapters that deal with somewhat dissimilar questions which are linked by the necessity to acknowledge and understand how unforeseeable shocks determine how agents make economic decisions. These shocks or innovations are a potential explanation for why, often similar economic actors face very different paths.

In Chapter 2, the interest lays in the determinants of different life-cycle fertility outcomes across educational groups. The chapter presents a model where individuals deal with idiosyncratic shocks ...

Beyond Computation: Information Technology, Organizational Transformation And Business Performance, Erik Brynjolfsson, Lorin M. Hitt Jan 2000

#### Beyond Computation: Information Technology, Organizational Transformation And Business Performance, Erik Brynjolfsson, Lorin M. Hitt

##### Operations, Information and Decisions Papers

To understand the economic value of computers, one must broaden the traditional definition of both the technology and its effects. Case studies and firm-level econometric evidence suggest that: 1) organizational "investments" have a large influence on the value of IT investments; and 2) the benefits of IT investment are often intangible and disproportionately difficult to measure. Our analysis suggests that the link between IT and increased productivity emerged well before the recent surge in the aggregate productivity statistics and that the current macroeconomic productivity revival may in part reflect the contributions of intangible capital accumulated in the past.