Related papers: Sector-Specific Substitution and the Effect of Sec…
The main purpose of this paper is to generalize some recent results obtained by Chilarescu and Manuel Gomez. Essentially, we are trying to study the effect of elasticity of substitution on the parameters of economic growth, based on its two…
We study the distributional implications of uncertainty shocks by developing a model that links macroeconomic aggregates to the US distribution of earnings and consumption. We find that: initially, the fraction of low-earning workers…
We model sectoral production by serially nesting (cascading) binary compounding processes. The sequence of processes is discovered in a self-similar hierarchical structure stylized in macroscopic input-output transactions. The feedback…
We study how product specialization choices affect supply chain resilience. We propose a theory of supply chain formation in which only compatible inputs can be used in final production. Intermediate producers choose how much to specialize…
This paper investigates how the granularity of supply-chain data affects the propagation of economic shocks through production networks. Using newly constructed establishment-level supply chains with product-level information links for…
Gender segmentation in labor markets shapes the local effects of international trade. We develop a theory that combines exports with gender-segmented labor markets and show that, in this framework, foreign demand shocks may either increase…
This paper develops a new model of business cycles. The model is economical in that it is solved with an aggregate demand-aggregate supply diagram, and the effects of shocks and policies are obtained by comparative statics. The model builds…
This paper examines how natural gas supply shocks affect Italian firms' pricing decisions and inflation expectations using quarterly survey data from the Bank of Italy's Survey on Inflation and Growth Expectations (SIGE). We identify…
The expansion of global production networks has raised many important questions about the interdependence among countries and how future changes in the world economy are likely to affect the countries' positioning in global value chains. We…
We study the disequilibrium dynamics of a stylised model of production networks in which firms use perishable and non-substitutable intermediate inputs, so that adverse idiosyncratic productivity shocks can trigger downstream shortages and…
The price of oil can rise because of a disruption to supply or an increase in demand. The nature of the price change determines the dynamic effects. As Kilian (2009) put it: "not all oil price shocks are alike." Using the latest available…
We show that a simple and intuitive three-parameter equation fits remarkably well the evolution of the gross domestic product (GDP) in current and constant dollars of many countries during times of recession and recovery. We then argue that…
We study a new kind of non-zero-sum stochastic differential game with mixed impulse/switching controls, motivated by strategic competition in commodity markets. A representative upstream firm produces a commodity that is used by a…
This paper studies regional exposure designs that use commodity prices as instruments to study local effects of aggregate shocks. Unlike standard shift share designs that leverage differential exposure to many shocks, the price exposure…
This paper examines how shocks to currency volatilities predict exchange rates. Using option-implied volatilities, we construct a dynamic, directed network of volatility connections. Currencies that transmit more volatility shocks, which…
We develop a theoretical framework to investigate the link between rising scale economies and stagnating productivity. Our model features heterogeneous firms, imperfect competition, and firm selection. We demonstrate that scale economies…
This paper evaluates the dynamic response of economic activity to shocks in uncertainty as percieved by agents.The study focuses on the comparison between the perception of economic uncertainty by manufacturers and consumers.Since…
We review the evidence that the erratic dynamics of markets is to a large extent of endogenous origin, i.e. determined by the trading activity itself and not due to the rational processing of exogenous news. In order to understand why and…
This paper develops a new framework to analyze the incidence of labor market shocks, focusing on automation and artificial intelligence. Central to our theory is the distance-dependent elasticity of substitution (DIDES), where worker…
In competitive supply chains (SCs), pricing decisions are crucial, as they directly impact market share and profitability. Traditional SC models often assume continuous pricing for mathematical convenience, overlooking the practical reality…