Monetary policy is conducted in an environment of considerable uncertainty. In particular, Bernanke (2007) emphasizes that monetary authority faces substantial challenges in determining the sources of variation in macroeconomic variables. What can policy-makers do when supply and demand disturbances are unobserved and indistinguishable? Is a policy rule widely conducted otherwise still appropri...

This paper analyzes to what extent labor market frictions limit the gains from market integration. I use an external demand shock to the Spanish economy as a natural experiment to identify and quantify the effect of labor mobility costs on Spain’s development. Using newly digitized trade and labor market data, I show that during WWI (1914-1918) a large, temporary and sectorally heterogeneous de...

We present two systems of differential equations implied by two different models of price discovery. One is the basic Walrasian model, where prices adjust to a security’s own excess demand. The basic Walrasian model does not feature cross-security effects (the price of one security reacts to excess demand in another). The alternative is a model where demand adjusts autonomously to perceived exc...

We analyse the impact of oil supply, global economic activity, oil-specific consumption demand, and oil-inventory demand shocks on equity-market tail risks a panel 48 developed emerging economies over monthly period from 1975:01 to 2017:12. find that, reduce risks, but shock increases with these effects stronger in oil-exporting economies. Our results have important implications for investors p...

In extensive oil-related literature, less attention has been paid to Asia and particularly little evidence is known for oil-refining countries. This paper examines how the economy of an country reacts oil price shock performs cross-country comparisons with oil-exporting oil-importing Singapore (oil refiner), Japan importer), Malaysia exporter) are analysed through a structural vector autoregres...

Abstract We analyze how demand conditions faced by a firm in its export markets affect innovation decisions. exploit exogenous firm-level shocks and find that firms respond patenting more; furthermore this response is driven the subset of initially more productive firms. The patent arises 2 to 5 years after shock, highlighting time required innovate. In contrast, shock raises contemporaneous sa...

We use machine learning techniques to quantify trade tensions between US and China. Our measure matches well-known events in the US-China dispute is exogenous developments on global financial markets. Local projections show that rising leave markets largely unaffected, except for firms are more exposed China, while negatively impacting stock market indices exchange rates China EMEs. complement ...

This paper measures the effectiveness of platform endorsement and consumergenerated reputation on sellers’ demand in online service marketplace. We apply BLPstyle model to understand consumers’ heterogeneous sensitivity to platform endorsement and consumer-generated reputation with endogeneity issue handled nicely. In addition, we investigate “conform or to be cast out” policy, which is applied...