The Intensifying Effects of Prolonged Climate Change on Conflict, 1400–1900 CE

By Murat Iyigun, Joris Mueller, and Nancy Qian

AEA Papers and Proceedings, May 2024

This study uses historical conflict and weather data for the period 1400–1900 CE to investigate the long-run effects of climate change on political instability in a context that suffered extensive cooling. The results show that temperature changes have ...

The Slanted-L Phillips Curve

By Pierpaolo Benigno and Gauti B. Eggertsson

AEA Papers and Proceedings, May 2024

A slanted-L curve is well suited to represent the nonlinearity of the celebrated Phillips curve. We show this using cross-country data of major industrialized economies since 2009, including the inflationary surge of the 2020s. At high unemployment rates,...

Origins of US Inflation

By Christopher A. Sims

AEA Papers and Proceedings, May 2024

Measuring fiscal pressure on inflation by the ratio of the primary deficit to the outstanding federal debt, this paper traces its growth through the 1970s, along with the shifts in the politics of deficits. There are thought-provoking parallels to the pan...

The NY Fed DSGE Model: A Post-COVID Assessment

By Marco Del Negro, Keshav Dogra, Aidan Gleich, Pranay Gundam, Donggyu Lee, Ramya Nallamotu, and Brian Pacula

AEA Papers and Proceedings, May 2024

We document the real-time forecasting performance for output and inflation of the New York Fed dynamic stochastic general equilibrium (DSGE) model since 2011. We find the DSGE's accuracy to be comparable to that of private forecasters before COVID but som...

What Do Long Data Tell Us about the Permanent Component of Inflation?

By Stephanie Schmitt-Grohé and Martín Uribe

AEA Papers and Proceedings, May 2024

Is postwar data enough to estimate the permanent component of inflation? We find that it is not for episodes of sudden and large inflation spikes like the one observed after the COVID-19 pandemic because such episodes are rare in the prewar sample (the in...

What Drives US Import Price Inflation?

By Mary Amiti, Oleg Itskhoki, and David E. Weinstein

AEA Papers and Proceedings, May 2024

Inflation has risen sharply in many countries since the COVID-19 outbreak, and economists have debated the underlying causes. In this paper, we examine the drivers of the global import price inflation, which peaked at approximately 11 percent a year. We f...

Supply Disruptions and Fiscal Stimulus: Transmission through Global Value Chains

By François de Soyres, Alexandre Gaillard, Ana Maria Santacreu, and Dylan Moore

AEA Papers and Proceedings, May 2024

We study the impact of demand and supply factors on bottlenecks and inflation during the COVID-19 pandemic. Initial policy interventions, from lockdowns to fiscal stimuli, triggered shifts in consumer spending and supply chain disruptions. The reopening o...

Import Constraints

By Diego Comin, Robert C. Johnson, and Callum Jones

AEA Papers and Proceedings, May 2024

During the recovery from the COVID-19 pandemic, international shipping and logistics capacity was strained, limiting the quantity of imports. We investigate the impact of an import constraint on inflation, following an increase in domestic demand. Whether...

Wealth Inequality and Altruistic Bequests

By John Laitner

American Economic Review, May 2002

Vertical Spillovers in Global Value Chains

By Swapnika Rachapalli

AEA Papers and Proceedings, May 2024

This paper uses input-output relationships across highly disaggregated products to establish two empirical regularities with bilateral trade data. First, countries are likely to have revealed comparative advantage (RCA) in a product if they also have RCA ...

Export-Platform FDI: Cannibalization or Complementarity?

By Pol Antràs, Evgenii Fadeev, Teresa C. Fort, and Felix Tintelnot

AEA Papers and Proceedings, May 2024

We develop a model of export-platform foreign direct investment in which final goods are produced only with labor and there are no fixed costs of exporting. We derive a simple condition that determines whether an MNE's plants are substitutes or complement...

Aggregation Bias in the Measurement of US Global Value Chains

By Aaron Flaaen, Fariha Kamal, Eunhee Lee, and Kei-Mu Yi

AEA Papers and Proceedings, May 2024

This paper employs US census microdata to construct establishment-level measures of global value chains (GVCs) and then assesses aggregation bias—the bias occurring when an entire industry is essentially treated as a single establishment. Our establishm...

Exorbitant Privilege and the Sustainability of US Public Debt

By Jason Choi, Duong Dang, Rishabh Kirpalani, and Diego J. Perez

AEA Papers and Proceedings, May 2024

We study the extent to which the perceived cost of losing the exorbitant privilege the United States holds in global safe asset markets sustains its public debt safety. Our findings indicate that losing this special status in the event of a default signif...

Borrowing from China and Sovereign Credit Risk

By Illenin Kondo, Astghik Mkhitaryan, and César Sosa-Padilla

AEA Papers and Proceedings, May 2024

China's lending to developing nations has surged since the mid–2000s, making it these nations' largest official creditor. Contracts frequently feature unique terms, indicating China's substantial privileges as a lender. However, other lenders are also i...

Digital Assets and the Exorbitant Dollar Privilege

By Marina Azzimonti and Vincenzo Quadrini

AEA Papers and Proceedings, May 2024

This paper analyzes how the rise of digital assets, particularly stablecoins, affects the US dollar's dominance in global financial markets. It discusses whether stablecoins, backed by US debt or other assets such as cryptocurrencies, could replace tradit...

Global Spillovers from Fed Hikes and a Strong Dollar: The Risk Channel

By José Cristi, Şebnem Kalemli-Özcan, Mariana Sans, and Filiz Unsal

AEA Papers and Proceedings, May 2024

We study the international transmission of US monetary policy shocks and a strong US dollar. We show that monetary tightening is linked to a higher risk premium, only in emerging markets, measured by deviations from uncovered interest parity. An appreciat...

Race, Police Violence, and Financial Decision-Making

By Vicki L. Bogan, Lisa A. Kramer, Chi Liao, and Alexandra Niessen-Ruenzi

AEA Papers and Proceedings, May 2024

We find an economically and statistically significant effect of race-based police violence on home ownership and retirement savings. Using restricted-use Panel Study of Income Dynamics data, we show that Black individuals exposed to the fatality of a Blac...

Setting the Record Straight on Racial Wealth Inequality

By Fenaba R. Addo, William A. Darity Jr., and Samuel L. Myers Jr.

AEA Papers and Proceedings, May 2024

The racial wealth gap in the United States is the object of much misrepresentation and misunderstanding. Our paper is intended to provide a corrective. We will address how the mainstream economic view of the drivers of racial disparities in wealth is a hu...

Gender and Racial Behavior in Consumer Payment Methods under Economic Uncertainty

By Raffi E. Garcia and Jyothsna G. Harithsa

AEA Papers and Proceedings, May 2024

This paper analyzes the effects of high economic uncertainty on racial and gender behavior in payment methods. Using US consumer transaction-level data, we find that consumers alter their payment behavior patterns in periods of high economic uncertainty b...

The Importance of Bequests and Life-Cycle Saving in Capital Accumulation: A New Answer

By Karen E. Dynan, Jonathan Skinner, and Stephen P. Zeldes

American Economic Review, May 2002