This paper uses administrative data on schooling and earnings from Texas to estimate quantile treatment effects of college quality on earnings. We proxy college quality using the college sector from which students graduate and focus on identifying how graduating from UT-Austin, Texas A&M or a community college affects the distribution of earnings relative to graduating from a non-flagship unive...

This paper studies the business-cycle fluctuations predicted by a two-sector endogenousbusiness-cycle model with sector-specific external increasing returns to scale. It focuses on aspects of actual fluctuations that have been identified both as defining features of the business cycle and as ones that standard real-business-cycle models cannot explain: the autocorrelation function of output gro...

We study the possibility for international diversi cation of catastrophe risk by the insurance sector. Adopting the argument that large insurance losses may be a `globalizing factor' for the industry, we study the dependence of geographically distant insurance markets via equity returns. In particular, we employ conditional copula theory to model the bivariate dependence of the insurance indust...

We examine how inv estment in human capital affects the U.S. economy using a three-sector growth model. Investment in human capital is produced in a constant returns to scale Education sector that has capital, labor, student time and intermediates as inputs. The perfectly foresighted household determines investment in physical capital while the government determines the rate of Education invest...

In this paper we generalize Vasicek’s Asymptotic Single Risk Factor (ASRF) solution to multiple factors organized with a particular hierarchical structure. We use this model to investigate credit portfolio loss. In this hierarchical factor model, asset returns of a company depend on a global factor, a sector factor, and an idiosyncratic risk factor. All companies share the same global factor an...

In this paper, we study a two-sector version of the AK model proposed by Rebelo (1991), where constant returns to capital are confined to the investment goods sector. We show that this setup, an endogenous growth extension to the model of Greenwood, Hercowitz, and Krusell (1997), reproduces important features of the U.S. NIPA data, namely the secular downward trend of the price of equipment inv...

This paper presents a two-sector growth model which allows indeterminacy to occur at relatively mild degrees of increasing returns. It is shown that economies of scale need only be present in one sector of the economy, e.g. the investment good producing sector. This new feature of the model builds on evidence that was recently reported by Basu and Fernald (1997), (Journal of Political Economy 1...

We examine the effects of uncertainty on the financial sector in a multidimensional context. In our investigation, using a large country-level unbalanced panel dataset, we show that inflation uncertainty reduces availability of private sector credit; harms banks’ efficiency and operational performance, evidenced by lower returns and increased reliance on non-interest income activities; and dist...