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@PREAMBLE{ "\providecommand{\noopsort}[1]{} "
# "\providecommand{\singleletter}[1]{#1} " }
@Misc{ SCF2004,
author = {{Board of Governors of the Federal Reserve System}},
title = {Survey of Consumer Finances, 2004},
year = {2004},
howpublished = {\url{https://www.federalreserve.gov/econres/scfindex.htm}},
note = {Data files: Summary Extract Public Data (rscfp2004.dta)
and Full Public Data Set (p04i6.dta). Available at
\url{https://www.federalreserve.gov/econres/scf_2004.htm}.
Accessed November 2025}
}
@TechReport{ kotsogiannisMPCs,
title = "{MPCs Estimated from Tax Lottery, Survey and
Administrative Data}",
author = "Kotsogiannis, Christos and Sakellaris, Plutarchos",
abstract = "We estimate intertemporal marginal propensities to consume
(iMPCs) from an unex- pected fiscal transfer using both
administrative and survey data for the same households.
Leveraging random assignment from a tax lottery, we
identify large causal effects of the income windfall,
tracking iMPCs for eight months. Revealed-preference
estimates from expenditure data align with
reported-preference survey results for the same households,
underscoring the validity of our data and methods. We
observe substantial heterogeneity in MPCs and relate it to
observable household characteristics. Households report a
higher MPC for unexpected income losses compared to gains
and prioritize debt repayment.",
year = 2024,
url = "https://tarc.exeter.ac.uk/collaboration/directstimuluspayments/",
howpublished = "Manuscript",
institution = "Athens University of Economics and Business"
}
@Article{ crawley2024parsimonious,
title = {A Parsimonious Model of Idiosyncratic Income},
author = {Crawley, Edmund and Holm, Martin B. and Tretvoll,
H{\aa}kon},
year = {2024},
month = {September},
type = {Working paper},
journal = {Board of Governors of the Federal Reserve System}
}
@Article{ Lian2023-ca,
title = "Mistakes in future consumption, high {MPCs} now",
author = "Lian, Chen",
journal = "American Economic Review: Insights",
publisher = "American Economic Association",
volume = 5,
number = 4,
pages = "563--581",
abstract = "In a canonical intertemporal consumption model, future
consumption mistakes (in response to saving changes) lead
to higher current marginal propensities to consume (MPCs).
These mistakes increase the value of changing current
consumption relative to changing saving, as additional
saving will not be spent optimally. Various behavioral
biases can cause these mistakes, such as inattention,
present bias, diagnostic expectations, and near-rationality
(epsilon-mistakes). This result helps explain the empirical
puzzle of high-liquidity consumers’ high MPCs. In my
approach, predictions of sophistication (anticipation of
future mistakes) can be derived independently of the
underlying biases. (JEL D15, D91, E21)",
month = dec,
year = 2023,
language = "en"
}
@TechReport{ broer2025stimulus,
title = {Stimulus Effects of Common Fiscal Policies},
author = {Broer, Tobias and Druedahl, Jeppe and Harmenberg, Karl and
{\"O}berg, Erik},
year = {2025},
type = {Discussion Paper},
number = {19823},
institution = {Center for Economic Policy Research}
}
@Article{ ansQuickfix,
title = "{Quick-fixing: Near-rationality in consumption and savings
behavior}",
author = "Andre, Peter and Flynn, Joel and Nikolakoudis, Georgios
and Sastry, Karthik",
journal = "SSRN Electronic Journal",
month = feb,
year = 2025,
url = "http://www.nber.org/papers/w33464.pdf",
file = "All-Papers/Other/Andre-et-al-Quick-fixing-Near-rationality-in-consumption-and-savings-behavior.pdf",
doi = "10.3386/w33464",
issn = "1556-5068"
}
@Article{ Ravn2021,
title = "{Macroeconomic Fluctuations with HANK \& SAM: an
Analytical Approach}",
author = "Ravn, Morten O and Sterk, Vincent",
journal = "Journal of the European Economic Association",
volume = 19,
pages = "1162--1202",
month = jun,
year = 2021,
publisher = {Oxford University Press}
}
@Article{ boehm2025fivefacts,
author = {Boehm, Johannes and Fize, Etienne and Jaravel, Xavier},
title = {Five Facts about MPCs: Evidence from a Randomized
Experiment},
journal = {American Economic Review},
volume = {115},
number = {1},
year = {2025},
month = {January},
pages = {1–42},
doi = {10.1257/aer.20240138},
url = {https://www.aeaweb.org/articles?id=10.1257/aer.20240138}
}
@Article{ gravesUnemployment,
title = "{Does unemployment risk affect business cycle dynamics?}",
author = "Graves, Sebastian",
journal = "American Economic Journal Macroeconomics",
abstract = "In this paper, I show that the decline in household
consumption during unemployment spells depends on both
liquid and illiquid asset positions. I also provide
evidence that unemployment spells predict the withdrawal of
illiquid assets, particularly when households have few
liquid assets. Motivated by these findings, I embed
endogenous unemployment risk in a two-asset
heterogeneous-agent New Keynesian model. The model is
consistent with the above evidence and provides a new
propagation mechanism for aggregate shocks due to a
flight-to-liquidity that occurs when unemployment risk
rises. This mechanism implies that unemployment insurance
plays an important role as an automatic stabilizer,
particularly when monetary policy is constrained.",
month = sep,
year = 2024,
url = "https://www.federalreserve.gov/econres/ifdp/files/ifdp1298.pdf",
doi = "10.17016/IFDP.2020.1298",
issn = "1945-7707,1945-7715"
}
@Article{ ilutEconomic,
title = "Economic Agents as Imperfect Problem Solvers",
author = "Ilut, Cosmin and Valchev, Rosen",
journal = "Q. J. Econ.",
publisher = "Oxford Academic",
volume = 138,
number = 1,
pages = "313--362",
abstract = "Abstract. We develop a novel bounded rationality model of
imperfect reasoning as the interaction between automatic
(System 1) and analytical (System 2) thinking",
month = dec,
year = 2022,
url = "https://www.nber.org/papers/w27820"
}
@Article{ cohenDisemployment,
title = "{Disemployment effects of unemployment insurance: A
meta-analysis}",
author = "Cohen, Jonathan and Ganong, Peter",
journal = "SSRN Electronic Journal",
publisher = "Elsevier BV",
year = 2024,
url = "https://www.nber.org/papers/w32832",
file = "All-Papers/HAFiscal/Cohen+Ganong-Disemployment-effects-of-unemployment-insurance-A-meta-analysis.pdf",
doi = "10.2139/ssrn.4929511",
issn = "1556-5068",
language = "en"
}
@TechReport{ carroll2023welfare,
title = {Welfare and Spending Effects of Consumption Stimulus
Policies},
author = {Carroll, Christopher and Crawley, Edmund and Frankovic,
Ivan and Tretvoll, H{\aa}kon},
year = {2023},
institution = {Board of Governors of the Federal Reserve System},
type = {Finance and Economics Discussion Series},
number = {2023-002},
address = {Washington},
doi = {10.17016/FEDS.2023.002}
}
@Article{ melcangiStock,
title = {Stock market participation, inequality, and monetary
policy},
author = {Melcangi, Davide and Sterk, Vincent},
journal = {Review of Economic Studies},
pages = {rdae068},
year = {2024},
publisher = {Oxford University Press UK}
}
@Article{ cstwMPC,
author = {Christopher D. Carroll and Jiri Sla{\-}calek and Kiichi
To{\-}ku{\-}o{\-}ka and Matt{\-}hew N. White},
journal = {Quantitative Economics},
month = {November},
note = {At \url{https://llorracc.github.io/cstwMPC}},
pages = {977--1020},
title = {The Dis{\-}tri{\-}bu{\-}tion of Wealth and the
Mar{\-}gi{\-}nal Pro{\-}pen{\-}si{\-}ty to Con{\-}sume},
volume = {8},
year = {2017},
doi = {10.3982/QE694},
url = {http://onlinelibrary.wiley.com/doi/10.3982/QE694/pdf},
number = {3},
keywords = {Wealth distribution, marginal propensity to consume,
heterogeneity, inequality, D12, D31, D91, E21},
eprint = {https://onlinelibrary.wiley.com/doi/pdf/10.3982/QE694},
abstract = {In a model calibrated to match micro- and macroeconomic
evidence on household income dynamics, we show that a
modest degree of heterogeneity in household preferences or
beliefs is sufficient to match empirical measures of wealth
inequality in the United States. The
heterogeneity-augmented model's predictions are consistent
with microeconomic evidence that suggests that the annual
marginal propensity to consume (MPC) is much larger than
the roughly 0.04 implied by commonly used macroeconomic
models (even ones including some heterogeneity). The high
MPC arises because many consumers hold little wealth
despite having a strong precautionary motive. Our model
also plausibly predicts that the aggregate MPC can differ
greatly depending on how the shock is distributed across
households (depending, e.g., on their wealth, or employment
status).}
}
@Article{ hkpMemorable,
title = "{On the welfare cost of consumption fluctuations in the
presence of memorable goods}",
author = "Hai, Rong and Krueger, Dirk and Postlewaite, Andrew",
journal = "Quantitative economics",
publisher = "The Econometric Society",
volume = 11,
number = 4,
pages = "1177--1214",
abstract = "We propose a new category of consumption goods, memorable
goods, that generate a utility flow even after physical
consumption. Empirically, memorable goods expenditures
exhibit frequent zero monthly purchases and lumpy
expenditure spikes. Memorable goods expenditures are 20\%
the size of nondurable expenditures, but three times as
volatile. We then develop a consumption-savings model with
borrowing constraints and income risk that formalizes the
notion of memorable goods and distinguishes them from other
nondurable goods. We show that consumers optimally choose
lumpy consumption of memorable goods. We then measure the
welfare cost of consumption fluctuations using our
calibrated model and empirically evaluate our calibrated
model's predictions for the consumption response to
predictable income changes. We find that the welfare cost
of household-level consumption fluctuations induced by
income shocks fall from 20.4 to 12.3 percentage points if
memorable goods are accounted for, and that empirical
estimates of excess sensitivity of consumption may
significantly be driven by memorable goods expenditures.",
year = 2020,
url = "http://dx.doi.org/10.3982/qe1173",
file = "All-Papers/HAFiscal/Hai-et-al-On-the-welfare-cost-of-consumption-fluctuations-in-the-presence-of-memorable-goods.pdf",
doi = "10.3982/qe1173",
issn = "1759-7323,1759-7331",
language = "en"
}
@Article{ indarte2024explains,
title = {What Explains the Consumption Decisions of Low-Income
Households?},
author = {Indarte, Sasha and Kluender, Raymond and Malmendier,
Ulrike and Stepner, Michael},
year = {2024},
type = {working paper},
institution = {University of Pennsylvania},
journal = {Department of Economics}
}
@Article{ Auclert2021,
author = {Auclert, Adrien and Bardóczy, Bence and Rognlie, Matthew
and Straub, Ludwig},
title = {Using the Sequence-Space Jacobian to Solve and Estimate
Heterogeneous-Agent Models},
journal = {Econometrica},
volume = {89},
number = {5},
pages = {2375--2408},
keywords = {Computational methods, general equilibrium, heterogeneous
agents, linearization},
doi = {https://doi.org/10.3982/ECTA17434},
url = {https://onlinelibrary.wiley.com/doi/abs/10.3982/ECTA17434},
year = {2021},
institution = {Stanford University}
}
@TechReport{ arsJumpsHumps,
abstract = {We estimate a Heterogeneous-Agent New Keynesian model with
sticky household expectations that matches existing
microeconomic evidence on marginal propensities to consume
and macroeconomic evidence on the impulse response to a
monetary policy shock. Our estimated model uncovers a
central role for investment in the transmission mechanism
of monetary policy, as high MPCs amplify the investment
response in the data. This force also generates a
procyclical response of consumption to investment shocks,
leading our model to infer a central role for these shocks
as a source of business cycles.},
author = {Adrien Auclert and Matthew Rognlie and Ludwig Straub},
note = {Revise and resubmit at American Economic Review},
title = {Micro Jumps, Macro Humps: Monetary Policy and Business
Cycles in an Estimated HANK Model},
url = {https://scholar.harvard.edu/straub/publications/jumps-humps},
journal = {Revise and Resubmit, American Economic Review},
institution = {Stanford University},
year = 2020
}
@Article{ Blanchard2010,
author = {Blanchard, Olivier and Galí, Jordi},
title = {Labor Markets and Monetary Policy: A New Keynesian Model
with Unemployment},
journal = {American Economic Journal: Macroeconomics},
volume = {2},
number = {2},
year = {2010},
month = {April},
pages = {1–30},
doi = {10.1257/mac.2.2.1},
url = {https://www.aeaweb.org/articles?id=10.1257/mac.2.2.1}
}
@Article{ DenHaan2000,
issn = {00028282},
url = {http://www.jstor.org/stable/117339},
author = {Wouter J. den Haan and Garey Ramey and Joel Watson},
journal = {The American Economic Review},
number = {3},
pages = {482--498},
publisher = {American Economic Association},
title = {Job Destruction and Propagation of Shocks},
urldate = {2024-11-11},
volume = {90},
year = {2000}
}
@TechReport{ Bardoczy2022,
title = "Spousal Insurance and the Amplification of Business
Cycles",
author = "Bardoczy, Bence",
year = "2024",
type = "Manuscript",
institution = {Board of Governors of the Federal Reserve System}
}
@TechReport{ Du2024,
title = "The Macroeconomic Consequences of Unemployment Scarring",
author = "Du, William",
year = "2024",
type = "Manuscript",
institution = "The Johns Hopkins University"
}
@Article{ Christiano2016,
author = {Christiano, Lawrence J. and Eichenbaum, Martin S. and
Trabandt, Mathias},
title = {Unemployment and Business Cycles},
journal = {Econometrica},
volume = {84},
number = {4},
pages = {1523--1569},
keywords = {Search and matching, unemployment, business cycles, wage
inertia, Nash bargaining, alternating offer bargaining,
wage rules, unemployment benefits, Bayesian estimation},
doi = {https://doi.org/10.3982/ECTA11776},
url = {https://onlinelibrary.wiley.com/doi/abs/10.3982/ECTA11776},
eprint = {https://onlinelibrary.wiley.com/doi/pdf/10.3982/ECTA11776},
year = {2016}
}
@TechReport{ Gornemann2021,
author = "Gornemann, Nils and Kuester, Keith and Nakajima, Makoto",
title = "Doves for the Rich, Hawks for the Poor? Distributional
Consequences of Systematic Monetary Policy",
year = "2021",
month = "May",
institution = "University of Bonn and University of Cologne, Germany",
type = "ECONtribute Discussion Papers Series",
url = "https://ideas.repec.org/p/ajk/ajkdps/089.html",
number = "089"
}
@Article{ Ravn2017,
title = {Job uncertainty and deep recessions},
journal = {Journal of Monetary Economics},
volume = {90},
pages = {125--141},
year = {2017},
issn = {0304-3932},
doi = {https://doi.org/10.1016/j.jmoneco.2017.07.003},
url = {https://www.sciencedirect.com/science/article/pii/S0304393217300806},
author = {Morten O. Ravn and Vincent Sterk},
keywords = {Job uncertainty, Unemployment, Endogenous countercyclical
income risk, Amplification}
}
@Article{ Rotemberg1982,
issn = {00223808, 1537534X},
url = {http://www.jstor.org/stable/1830944},
author = {Julio J. Rotemberg},
journal = {Journal of Political Economy},
number = {6},
pages = {1187--1211},
publisher = {The University of Chicago Press},
title = {Sticky Prices in the United States},
urldate = {2024-11-11},
volume = {90},
year = {1982}
}
@Article{ Silva2009,
title = {Labor Turnover Costs and The Cyclical Behavior or
Vacancies and Unemployment},
author = {Silva, José and Toledo, Manuel},
year = {2009},
journal = {Macroeconomic Dynamics},
volume = {13},
number = {S1},
pages = {76--96},
url = {https://EconPapers.repec.org/RePEc:cup:macdyn:v:13:y:2009:i:s1:p:76-96_08}
}
@Article{ mincer1991education,
title = {Education and Unemployment},
author = {Mincer, Jacob},
journal = {NBER Working Paper w3838},
year = {1991},
url = "https://www.nber.org/papers/w3838"
}
@Article{ elsby2010labor,
title = {The Labor Market in the Great Recession},
author = {Elsby, Michael W L and Hobijn, Bart},
journal = {Brookings Papers on Economic Activity},
year = {2010},
publisher = {Citeseer}
}
@TechReport{ benigno2023baaack,
title = "It’s Baaack: The Surge in Inflation in the 2020s and the
Return of the Non-Linear Phillips Curve",
author = "Benigno, Pierpaolo and Eggertsson, Gauti B",
institution = "National Bureau of Economic Research",
type = "Working Paper",
series = "Working Paper Series",
number = "31197",
year = "2023",
month = "April",
doi = {10.3386/w31197},
url = "http://www.nber.org/papers/w31197"
}
@TechReport{ blanco2024nonlinear,
title = "Non-Linear Inflation Dynamics in Menu Cost Economies",
author = "Blanco, Andres and Boar, Corina and Jones, Callum J and
Midrigan, Virgiliu",
institution = "National Bureau of Economic Research",
type = "Working Paper",
series = "Working Paper Series",
number = "32094",
year = "2024",
month = "January",
doi = {10.3386/w32094},
url = "http://www.nber.org/papers/w32094"
}
@TechReport{ phan2024welfare,
title = "The Welfare Consequences of Countercyclical Fiscal
Transfers",
author = "Phan, Nam",
type = "Manuscript",
institution = "Queens Economics Department",
year = "2024"
}
@Article{ graham2024mental,
title = {Mental Accounts and Consumption Sensitivity Across the
Distribution of Liquid Assets},
author = {Graham, James and McDowall, Robert},
journal = {Available at SSRN 4793885},
year = {2024}
}
@Article{ kueng2018excess,
author = {Kueng, Lorenz},
title = {Excess Sensitivity of High-Income Consumers*},
journal = {The Quarterly Journal of Economics},
volume = {133},
number = {4},
pages = {1693--1751},
year = {2018},
month = {06},
issn = {0033-5533},
doi = {10.1093/qje/qjy014},
url = {https://doi.org/10.1093/qje/qjy014},
eprint = {https://academic.oup.com/qje/article-pdf/133/4/1693/25985655/qjy014.pdf}
}
@Article{ lmmPresentBias,
title = {Present Bias Amplifies the Household Balance-Sheet
Channels of Macroeconomic Policy},
author = {Maxted, Peter and Laibson, David and Moll, Benjamin},
journal = {The Quarterly Journal of Economics},
pages = {qjae026},
year = {2024},
publisher = {Oxford University Press}
}
@Article{ akerlof1985near,
title = {A near-rational model of the business cycle, with wage and
price inertia},
author = {Akerlof, George A and Yellen, Janet L},
journal = {The Quarterly Journal of Economics},
volume = {100},
number = {Supplement},
pages = {823--838},
year = {1985},
publisher = {MIT Press}
}
@Article{ cochrane1989sensitivity,
title = {The Sensitivity of Tests of the Intertemporal Allocation
of Consumption to Near-Rational Alternatives},
author = {Cochrane, John H},
journal = {The American Economic Review},
pages = {319--337},
year = {1989},
publisher = {JSTOR}
}
@Article{ bcShocksStocks,
author = {Browning, Martin and Crossley, Thomas F.},
title = {Shocks, Stocks, and Socks: Smoothing Consumption Over a
Temporary Income Loss},
journal = {Journal of the European Economic Association},
volume = {7},
number = {6},
pages = {1169--1192},
doi = {https://doi.org/10.1162/JEEA.2009.7.6.1169},
url = {https://onlinelibrary.wiley.com/doi/abs/10.1162/JEEA.2009.7.6.1169},
eprint = {https://onlinelibrary.wiley.com/doi/pdf/10.1162/JEEA.2009.7.6.1169},
abstract = {Abstract We investigate how households in temporarily
straitened circumstances due to an unemployment spell cut
back on expenditures and how they spend marginal dollars of
unemployment insurance (UI) benefit. Our theoretical and
empirical analyses emphasize the importance of allowing for
the fact that households buy durable as well as non-durable
goods. The theoretical analysis shows that in the short run
households can cut back significantly on total expenditures
without a significant fall in welfare if they concentrate
their budget reductions on durables. We then present an
empirical analysis based on a Canadian survey of workers
who experienced a job separation. Exploiting changes in the
unemployment insurance system over our sample period we
show that cuts in UI benefits lead to reductions in total
expenditure with a stronger impact on clothing than on food
expenditures. Our empirical strategy allows that these
expenditures may be non-separable from employment status.
The effects we find are particularly strong for households
with no liquid assets before the spell started. These
qualitative findings are in precise agreement with the
theoretical predictions. (JEL: D11, D12, D91, J65)},
year = {2009}
}
@Article{ bayercoronavirus,
title = {The Coronavirus Stimulus Package: How Large is the
Transfer Multiplier?},
author = {Bayer, Christian and Born, Benjamin and Luetticke, Ralph
and M{\"u}ller, Gernot J},
journal = {The Economic Journal},
year = {2023},
doi = {https://doi.org/10.1093/ej/uead003}
}
@Article{ mckay2016role,
title = {The role of automatic stabilizers in the US business
cycle},
author = {McKay, Alisdair and Reis, Ricardo},
journal = {Econometrica},
volume = {84},
number = {1},
pages = {141--194},
year = {2016},
publisher = {Wiley Online Library}
}
@Article{ mckay2021optimal,
title = {Optimal automatic stabilizers},
author = {McKay, Alisdair and Reis, Ricardo},
journal = {The Review of Economic Studies},
volume = {88},
number = {5},
pages = {2375--2406},
year = {2021},
publisher = {Oxford University Press}
}
@TechReport{ hagedorn2019unemployment,
title = {Unemployment Benefits and Unemployment in the Great
Recession: The Role of Macro Effects},
author = {Hagedorn, Marcus and Karahan, Fatih and Manovskii, Iourii
and Mitman, Kurt},
year = {2019},
note = {Working paper 19499},
institution = {National Bureau of Economic Research}
}
@TechReport{ hmmUnemployment,
title = {The Impact of Unemployment Benefit Extensions on
Employment: The 2014 Employment Miracle?},
author = {Hagedorn, Marcus and Manovskii, Iourii and Mitman, Kurt},
year = {2017},
note = {Working paper 20884},
institution = {National Bureau of Economic Research}
}
@TechReport{ chodorow2016limited,
title = {The limited macroeconomic effects of unemployment benefit
extensions},
author = {Chodorow-Reich, Gabriel and Karabarbounis, Loukas},
year = {2016},
institution = {National Bureau of Economic Research}
}
@Article{ kekre2022unemp,
author = {Kekre, Rohan},
title = {Unemployment Insurance in Macroeconomic Stabilization},
journal = {The Review of Economic Studies},
year = {2022},
month = {12},
doi = {10.1093/restud/rdac080},
url = {https://doi.org/10.1093/restud/rdac080},
eprint = {https://academic.oup.com/restud/advance-article-pdf/doi/10.1093/restud/rdac080/49998599/rdac080.pdf}
}
@Article{ crawley2023MicroMacro,
author = {Crawley, Edmund and Kuchler, Andreas},
title = {Consumption Heterogeneity: Micro Drivers and Macro
Implications},
journal = {American Economic Journal: Macroeconomics},
volume = {15},
number = {1},
year = {2023},
month = {January},
pages = {314--41},
doi = {10.1257/mac.20200352},
url = {https://www.aeaweb.org/articles?id=10.1257/mac.20200352}
}
@Article{ broer2023fiscalmultipliers,
title = {Fiscal Multipliers: {A} Heterogenous-Agent Perspective},
author = {Broer, Tobias and Krusell, Per and {\"O}berg, Erik},
journal = {Quantitative Economics},
volume = {14},
number = {3},
pages = {799--816},
doi = {https://doi.org/10.3982/QE1901},
year = {2023}
}
@TechReport{ beraja2023size,
title = {On the Size of Stimulus Checks: How Much is Too Much?},
author = {Beraja, Martin and Zorzi, Nathan},
year = {2023},
note = {Working paper},
institution = {MIT}
}
@Article{ allcott2021high,
title = {Are high-interest loans predatory? {T}heory and evidence
from payday lending},
author = {Allcott, Hunt and Kim, Joshua J and Taubinsky, Dmitry and
Zinman, Jonathan},
year = {2021},
journal = {NBER Working paper, no. 28799},
month = {May},
note = {NBER Working paper, no. 28799}
}
@Article{ cagetti2003wealth,
title = {Wealth accumulation over the life cycle and precautionary
savings},
author = {Cagetti, Marco},
journal = {Journal of Business \& Economic Statistics},
volume = {21},
number = {3},
pages = {339--353},
year = {2003},
publisher = {Taylor \& Francis}
}
@Article{ carroll2020modeling,
title = {Modeling the consumption response to the {CARES} act},
author = {Carroll, Christopher D and Crawley, Edmund and Slacalek,
Jiri and White, Matthew N},
journal = {Covid Economics},
volume = {10},
pages = {62--86},
year = {2020},
publisher = {CEPR Press}
}
@Article{ carroll2022theoretical,
title = {Theoretical Foundations of Buffer Stock Saving},
author = {Carroll, Christopher D},
year = {2022},
institution = {The Johns Hopkins University},
note = {Working paper},
journal = {Department of Economics},
url = {https://econ-ark.github.io/BufferStockTheory/}
}
@Article{ kaplan2014model,
title = {A model of the consumption response to fiscal stimulus
payments},
author = {Kaplan, Greg and Violante, Giovanni L},
journal = {Econometrica},
volume = {82},
number = {4},
pages = {1199--1239},
year = {2014},
publisher = {Wiley Online Library}
}
@Article{ kravik-navigating-2019,
title = {Navigating with {NEMO}},
volume = {5},
url = {https://www.norges-bank.no/en/news-events/news-publications/Papers/Staff-Memo/2019/52019/},
language = {en},
urldate = {2019-05-24},
journal = {Norges Bank Staff Memo},
author = {Kravik, Erling Motzfeldt and Mimir, Yassin},
year = {2019}
}
@InCollection{ kmpHandbook,
title = {Macroeconomics and household heterogeneity},
author = {Krueger, Dirk and Mitman, Kurt and Perri, Fabrizio},
booktitle = {Handbook of {M}acroeconomics},
volume = {2},
pages = {843--921},
year = {2016},
publisher = {Elsevier},
abstract = {The goal of this chapter is to study how, and by how much,
household income, wealth, and preference heterogeneity
amplify and propagate a macroeconomic shock. We focus on
the US Great Recession of 2007–09 and proceed in two
steps. First, using data from the Panel Study of Income
Dynamics, we document the patterns of household income,
consumption, and wealth inequality before and during the
Great Recession. We then investigate how households in
different segments of the wealth distribution were affected
by income declines, and how they changed their expenditures
differentially during the aggregate downturn. Motivated by
this evidence, we study several variants of a standard
heterogeneous household model with aggregate shocks and an
endogenous cross-sectional wealth distribution. Our key
finding is that wealth inequality can significantly amplify
the impact of an aggregate shock, and it does so if the
distribution features a sufficiently large fraction of
households with very little net worth that sharply increase
their saving (ie, they are not hand-to mouth) as the
recession hits. We document that both these features are
observed in the PSID. We also investigate the role that
social insurance policies, such as unemployment insurance,
play in shaping the cross-sectional income and wealth
distribution, and through it, the dynamics of business
cycles.},
doi = {10.1016/bs.hesmac.2016.04.003},
isbn = 9780444594877,
issn = 15740048,
keywords = {Recessions,Social insurance,Wealth inequality},
url = {https://linkinghub.elsevier.com/retrieve/pii/S1574004816300039}
}
@Article{ fagereng-mpc-2021,
title = {{MPC} {Heterogeneity} and {Household} {Balance} {Sheets}},
volume = {13},
issn = {1945-7707},
url = {https://www.aeaweb.org/articles?id=10.1257/mac.20190211},
doi = {10.1257/mac.20190211},
abstract = {We use sizable lottery prizes in Norwegian administrative
panel data to explore how transitory income shocks are
spent and saved over time and how households' marginal
propensities to consume (MPCs) vary with household
characteristics and shock size. We find that spending peaks
in the year of winning and gradually reverts to normal
within five years. Controlling for all items on households'
balance sheets and characteristics such as education and
income, it is the amount won, age, and liquid assets that
vary systematically with MPCs. Low-liquidity winners of the
smallest prizes (around US\$1,500) are estimated to spend
all within the year of winning. The corresponding estimate
for high-liquidity winners of large prizes
(US\$8,300–150,000) is slightly below one-half. While
conventional models will struggle to account for such high
MPC levels, we show that a two-asset life cycle model with
a realistic earnings profile and a luxury bequest motive
can account for both the time profile of consumption
responses and their systematic covariation with
observables.},
language = {en},
number = {4},
urldate = {2022-02-11},
journal = {American Economic Journal: Macroeconomics},
author = {Fagereng, Andreas and Holm, Martin B. and Natvik, Gisle
J.},
month = oct,
year = {2021},
keywords = {Consumer Economics: Empirical Analysis, Intertemporal
Household Choice, includes inheritance and gift taxes, Life
Cycle Models and Saving, Macroeconomics: Consumption,
Saving, Wealth, Household Finance: Household Saving,
Borrowing, Debt, and Wealth, Personal Income and Other
Nonbusiness Taxes and Subsidies},
pages = {1--54}
}
@Article{ aursland-state-dependent-2020,
title = {State-dependent fiscal multipliers in {NORA} - {A} {DSGE}
model for fiscal policy analysis in {Norway}},
volume = {93},
issn = {0264-9993},
url = {https://www.sciencedirect.com/science/article/pii/S0264999320304156},
doi = {10.1016/j.econmod.2020.07.017},
abstract = {We develop a novel medium-scale DSGE model, called NORA,
for fiscal policy analysis in Norway. NORA contains a
sheltered and exposed sector allowing us to model wage
bargaining between a labor union and the exposed sector,
reflecting Scandinavian wage formation institutions. Wages
are subject to a downward nominal wage rigidity (DNWR).
Inspired by many countries' fiscal policy responses to the
Great Recession and the coronavirus pandemic, we
investigate the model's ability to generate state-dependent
fiscal multipliers. We find, that both the zero lower bound
on nominal interest rates and DNWR individually can account
for higher fiscal multipliers during recessions. In joint
presence, however, the existence of DNWR reduces the
multiplier at the ZLB. Moreover, the DNWR significantly
relaxes the paradox of toil at the ZLB. We show that the
state-dependency is robust to alternative assumptions about
the origin of the recession, the nature of the fiscal
stimulus and its financing source.},
language = {en},
urldate = {2022-02-11},
journal = {Economic Modelling},
author = {Aursland, Thor Andreas and Frankovic, Ivan and Kanik,
Birol and Saxegaard, Magnus},
year = {2020},
keywords = {Downward nominal wage rigidity, Fiscal multiplier, Fiscal
policy, State-dependency, Zero lower bound},
pages = {321--353}
}
@Article{ oecdReplacement,
title = {Net replacement rate in unemployment},
journal = {OECD statistics "Social Protection and Well-being"},
author = {OECD},
year = {2020},
url = {Url: https://stats.oecd.org/Index.aspx?DataSetCode=NRR}
}
@Article{ gjeldsregistret-nokkeltall-2022,
title = {Nokkeltall fra {Gjeldsregisteret}},
journal = {Gjeldsregistret nettside},
author = {Gjeldsregistret},
year = {2022},
url = {https://www.gjeldsregisteret.com/pages/nokkeltall}
}
@Article{ davis-recessions-2011,
issn = {00072303, 15334465},
url = {http://www.jstor.org/stable/41473597},
author = {Steven J. Davis and Till Von Wachter},
journal = {Brookings Papers on Economic Activity},
pages = {1--72},
publisher = {Brookings Institution Press},
title = {Recessions and the Costs of Job Loss},
urldate = {2022-04-08},
year = {2011}
}
@Article{ skiba2008payday,
title = {Payday loans, uncertainty and discounting: {E}xplaining
patterns of borrowing, repayment, and default},
author = {Skiba, Paige Marta and Tobacman, Jeremy},
journal = {Vanderbilt Law and Economics Research Paper},
volume = {08},
number = {33},
year = {2008}
}
@Article{ rothstein2017scraping,
title = {Scraping by: Income and program participation after the
loss of extended unemployment benefits},
author = {Rothstein, Jesse and Valletta, Robert G},
journal = {Journal of Policy Analysis and Management},
volume = {36},
number = {4},
pages = {880--908},
year = {2017},
publisher = {Wiley Online Library}
}
@Article{ den2010computational,
title = {Computational suite of models with heterogeneous agents:
Incomplete markets and aggregate uncertainty},
author = {Den Haan, Wouter J and Judd, Kenneth L and Juillard,
Michel},
journal = {Journal of Economic Dynamics and Control},
volume = {34},
number = {1},
pages = {1--3},
year = {2010},
publisher = {Elsevier}
}
@TechReport{ kaplanMPC2022,
title = "The Marginal Propensity to Consume in Heterogeneous Agent
Models",
author = "Kaplan, Greg and Violante, Giovanni L",
institution = "National Bureau of Economic Research",
type = "Working Paper",
series = "Working Paper Series",
number = "30013",
year = "2022",
month = "May",
doi = {10.3386/w30013},
url = "http://www.nber.org/papers/w30013",
abstract = {What model features and calibration strategies yield a
large average marginal propensity to consume (MPC) in
heterogeneous agent models? Through a systematic
investigation of models with different preferences,
dimensions of ex-ante heterogeneity, income processes and
asset structure, we show that the most important factor is
the share and type of hand-to-mouth households. One-asset
models either feature a trade-off between a high average
MPC and a realistic level of aggregate wealth, or generate
an excessively polarized wealth distribution that vastly
understates the wealth held by households in the middle of
the distribution. Two-asset models that include both liquid
and illiquid assets can resolve this tension with a large
enough gap between liquid and illiquid returns. We discuss
how such return differential can be justified from the
perspective of theory and data.}
}
@Article{ ganongConsumer2019,
author = {Ganong, Peter and Noel, Pascal},
title = {Consumer Spending during Unemployment: Positive and
Normative Implications},
journal = {American Economic Review},
volume = {109},
number = {7},
year = {2019},
month = {July},
pages = {2383--2424},
doi = {10.1257/aer.20170537},
url = {https://www.aeaweb.org/articles?id=10.1257/aer.20170537}
}
@TechReport{ hagedorn2019fiscal,
title = {The fiscal multiplier},
author = {Hagedorn, Marcus and Manovskii, Iourii and Mitman, Kurt},
year = {2019},
type = {Working paper},
institution = {National Bureau of Economic Research}
}
@Article{ christiano2011government,
title = {When is the government spending multiplier large?},
author = {Christiano, Lawrence and Eichenbaum, Martin and Rebelo,
Sergio},
journal = {Journal of Political Economy},
volume = {119},
number = {1},
pages = {78--121},
year = {2011},
publisher = {University of Chicago Press Chicago, IL}
}
@Article{ eggertsson2011fiscal,
title = {What fiscal policy is effective at zero interest rates?},
author = {Eggertsson, Gauti B},