A Groovy Efg
On Friday, I went to the NBER EFG (Economic Fluctuations together with Growth) coming together at the SF Fed. Program together with papers here. The papers were great, the discussions were great, the comments were great, fifty-fifty the nutrient was good. (You know you're inward California when the conference snack is avocado toast.)
The papers:
1) Fatih Guvenen, Gueorgui Kambourov, Burhanettin Kuruscu, Sergio Ocampo-Diaz, Daphne Chen, "Use It Or Lose It: Efficiency Gains from Wealth Taxation" Discussant: Roger H. Gordon.
If everyone earns 4% render on their investments, a 50% charge per unit of measurement of render taxation (combining corporate income together with personal taxes) is the same matter every bit a 2% wealth tax. Everyone gets a 2% later taxation render on their investments.
But what if to a greater extent than or less people -- Mike, inward the example, -- are skillful entrepreneurs together with tin move earn 20% charge per unit of measurement of return, piece together with others -- Fredo -- earn 0% returns. Now a 50% charge per unit of measurement of render taxation lowers Mike's render to 10% but has no outcome on Fredo. If the authorities raises the same amount of coin -- 10 cents -- from a 0.10/2.20 = 4.5% wealth tax, Mike earns a (1-0.045) x 1.20 -1 = 14.6% charge per unit of measurement of return, together with Fredo earns a - 4.5% charge per unit of measurement of return. The incentive to survive Mike rises, together with to survive Fredo declines.
The newspaper has a model amongst all sorts of useful bells together with whistles -- y'all desire these to produce taxation policy -- edifice on this intuition. The model fits all sorts of facts including the wealth distribution. The wealth taxation ends upwards helping workers too, because payoff rise.
2) Matteo Maggiori, Brent Neiman, Jesse Schreger, "International Currencies together with Capital Allocation"
Discussant: Harald Uhlig (funniest give-and-take award)
Mutual funds convey a rigid home currency bias, which completely drives out home bias. These investors similar to agree bonds inward their ain currency, but non necessarily issued past times companies inward their dwelling country. If y'all desire to sell bonds to Canadians -- fifty-fifty Canadian mutual funds -- sell them inward Canadian dollars. There is 1 exception: the dollar. When funds branch out to other currencies, they outset amongst dollars. Likewise, pocket-sized companies primarily heighten coin inward their ain currency. When they branch out, they outset amongst dollars.
3) Katarína Borovičková, Robert Shimer, "High Wage Workers Work for High Wage Firms" Discussant: Isaac Sorkin
H5N1 clever stair out of correlation, showing that, every bit the championship says, high wage workers locomote for companies that pay high average wages, together with also depression wage workers locomote for companies that pay depression wages. This seems obvious, but it has non been inward the data. The previous approach to this enquiry by Abowd, Kramarz together with Margolis (1999) flora no correlation. H5N1 big give-and-take most correlation vs the AKM regression estimate. It turns out the Definition of correlation is really subtle, together with depends on the form of search model y'all convey inward mind.
Ellen McGratten asked a sudden question: Wait, if a theatre outsources its janitors, does this non spike? Really nosotros are learning most the boundaries of the firm. Answer yes, together with actually nosotros desire to know whether high wage people locomote amongst other high wage people. More give-and-take most what the fact way most articulation production together with the sorting together with matching process.
4) Marcus Hagedorn, Iourii Manovskii, Kurt Mitman, "The Fiscal Multiplier" Discussant: Adrien Auclert
The papers:
1) Fatih Guvenen, Gueorgui Kambourov, Burhanettin Kuruscu, Sergio Ocampo-Diaz, Daphne Chen, "Use It Or Lose It: Efficiency Gains from Wealth Taxation" Discussant: Roger H. Gordon.
If everyone earns 4% render on their investments, a 50% charge per unit of measurement of render taxation (combining corporate income together with personal taxes) is the same matter every bit a 2% wealth tax. Everyone gets a 2% later taxation render on their investments.
But what if to a greater extent than or less people -- Mike, inward the example, -- are skillful entrepreneurs together with tin move earn 20% charge per unit of measurement of return, piece together with others -- Fredo -- earn 0% returns. Now a 50% charge per unit of measurement of render taxation lowers Mike's render to 10% but has no outcome on Fredo. If the authorities raises the same amount of coin -- 10 cents -- from a 0.10/2.20 = 4.5% wealth tax, Mike earns a (1-0.045) x 1.20 -1 = 14.6% charge per unit of measurement of return, together with Fredo earns a - 4.5% charge per unit of measurement of return. The incentive to survive Mike rises, together with to survive Fredo declines.
The newspaper has a model amongst all sorts of useful bells together with whistles -- y'all desire these to produce taxation policy -- edifice on this intuition. The model fits all sorts of facts including the wealth distribution. The wealth taxation ends upwards helping workers too, because payoff rise.
In the fake model calibrated to the U.S. of America data, a revenue-neutral taxation reform that replaces upper-case missive of the alphabet income taxation amongst a wealth taxation raises welfare past times most 8% inward consumption-equivalent terms. ... optimal wealth taxes resultant inward to a greater extent than fifty-fifty consumption together with leisure distributions (despite the wealth distribution becoming to a greater extent than dispersed)...wealth taxes tin move yield both efficiency together with distributional gainsMuch discussion, centering on whether science actually is tied to returns.
2) Matteo Maggiori, Brent Neiman, Jesse Schreger, "International Currencies together with Capital Allocation"
Discussant: Harald Uhlig (funniest give-and-take award)
Mutual funds convey a rigid home currency bias, which completely drives out home bias. These investors similar to agree bonds inward their ain currency, but non necessarily issued past times companies inward their dwelling country. If y'all desire to sell bonds to Canadians -- fifty-fifty Canadian mutual funds -- sell them inward Canadian dollars. There is 1 exception: the dollar. When funds branch out to other currencies, they outset amongst dollars. Likewise, pocket-sized companies primarily heighten coin inward their ain currency. When they branch out, they outset amongst dollars.
3) Katarína Borovičková, Robert Shimer, "High Wage Workers Work for High Wage Firms" Discussant: Isaac Sorkin
H5N1 clever stair out of correlation, showing that, every bit the championship says, high wage workers locomote for companies that pay high average wages, together with also depression wage workers locomote for companies that pay depression wages. This seems obvious, but it has non been inward the data. The previous approach to this enquiry by Abowd, Kramarz together with Margolis (1999) flora no correlation. H5N1 big give-and-take most correlation vs the AKM regression estimate. It turns out the Definition of correlation is really subtle, together with depends on the form of search model y'all convey inward mind.
Ellen McGratten asked a sudden question: Wait, if a theatre outsources its janitors, does this non spike? Really nosotros are learning most the boundaries of the firm. Answer yes, together with actually nosotros desire to know whether high wage people locomote amongst other high wage people. More give-and-take most what the fact way most articulation production together with the sorting together with matching process.
4) Marcus Hagedorn, Iourii Manovskii, Kurt Mitman, "The Fiscal Multiplier" Discussant: Adrien Auclert
This newspaper is most repairing the ridiculously huge estimates of financial multipliers inward New-Keyensian models at the nada bound. There is a lot going on including heterogenous agents amongst financing constraints, which I can't review.
Here's 1 matter I learned from it -- naturally related to the issues I convey idea most inward this context inward "the new-Keynesian liquidity trap" here. Building on an before newspaper past times Hagedorn, they posit a money-like need for authorities debt. Thus they convey nominal debt/price storey = component of something real. Like the financial theory, inward which nominal debt/price storey = expected introduce value of existent surpluses, together with similar MV=PY, this tin move create upwards one's withdraw heed the cost level, together with so alternative equilibria. They alternative equilibria amongst express inflation jumps, which similar the financial theory serves to boundary the size of the commons huge multipliers. The money-like nature of authorities bonds, whether from a backing theory similar the financial theory, or from this machinery similar to coin demand, is a mutual thread to many resolutions of new-Keynesian paradoxes. And it offers a much to a greater extent than conservative way forrard than telephone commutation surgery, such every bit abandoning rational expectations.
5) Carlos Garriga, Aaron Hedlund, "Housing Finance, Boom-Bust Episodes, together with Macroeconomic Fragility" Discussant: Guido Lorenzoni
I'm actually impressed amongst the exceptional of modern housing models similar this. Rent vs. ain decisions, provide of rental housing, search together with transactions costs to alter housing, incomplete markets, realistic mortgages, mortgage default, adjustment costs, nonseparable housing together with nonhousing consumption, refinancing, cash-out refinancings, and I likely missed one-half of it. Solve, stand upwards for a bunch of facts, analyze a crisis together with policy alternatives.
6) John Kennan, "Spatial Variation inward Higher Education Financing together with the Supply of College Graduates" Discussant:Danny Yagan
Different states subsidize college pedagogy to unlike degrees. Does having a groovy province academy pay off, inward that y'all acquire a improve workforce? Or produce your graduates merely all locomote out to New York together with locomote for investment banks, or to Palo Alto to locomote for Google? Apparently not.
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