A Corking 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 inwards 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% afterwards taxation render on their investments.
But what if roughly people -- Mike, inwards the example, -- are skillful entrepreneurs together with tin laissez passer notice 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 trial 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 hold upwardly Mike rises, together with to hold upwardly 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 upwardly helping workers too, because payoff rise.
2) Matteo Maggiori, Brent Neiman, Jesse Schreger, "International Currencies together with Capital Allocation"
Discussant: Harald Uhlig (funniest intelligence award)
Mutual funds convey a rigid home currency bias, which completely drives out home bias. These investors similar to concord bonds inwards their ain currency, but non necessarily issued yesteryear companies inwards their dwelling country. If y'all desire to sell bonds to Canadians -- fifty-fifty Canadian mutual funds -- sell them inwards Canadian dollars. There is ane exception: the dollar. When funds branch out to other currencies, they commencement amongst dollars. Likewise, minor companies primarily heighten coin inwards their ain currency. When they branch out, they commencement amongst dollars.
3) Katarína Borovičková, Robert Shimer, "High Wage Workers Work for High Wage Firms" Discussant: Isaac Sorkin
Influenza A virus subtype H5N1 clever mensurate of correlation, showing that, every bit the championship says, high wage workers travel for companies that pay high average wages, together with also depression wage workers travel for companies that pay depression wages. This seems obvious, but it has non been inwards the data. The previous approach to this interrogation by Abowd, Kramarz together with Margolis (1999) establish no correlation. Influenza A virus subtype H5N1 big intelligence near correlation vs the AKM regression estimate. It turns out the Definition of correlation is real subtle, together with depends on the form of search model y'all convey inwards mind.
Ellen McGratten asked a precipitous question: Wait, if a trouble solid outsources its janitors, does this non spike? Really nosotros are learning near the boundaries of the firm. Answer yes, together with actually nosotros desire to know whether high wage people travel amongst other high wage people. More intelligence near what the fact agency near 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% afterwards taxation render on their investments.
But what if roughly people -- Mike, inwards the example, -- are skillful entrepreneurs together with tin laissez passer notice 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 trial 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 hold upwardly Mike rises, together with to hold upwardly 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 upwardly helping workers too, because payoff rise.
In the imitation model calibrated to the USA data, a revenue-neutral taxation reform that replaces working capital missive of the alphabet income taxation amongst a wealth taxation raises welfare yesteryear near 8% inwards consumption-equivalent terms. ... optimal wealth taxes final result inwards 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 laissez passer notice 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 intelligence award)
Mutual funds convey a rigid home currency bias, which completely drives out home bias. These investors similar to concord bonds inwards their ain currency, but non necessarily issued yesteryear companies inwards their dwelling country. If y'all desire to sell bonds to Canadians -- fifty-fifty Canadian mutual funds -- sell them inwards Canadian dollars. There is ane exception: the dollar. When funds branch out to other currencies, they commencement amongst dollars. Likewise, minor companies primarily heighten coin inwards their ain currency. When they branch out, they commencement amongst dollars.
3) Katarína Borovičková, Robert Shimer, "High Wage Workers Work for High Wage Firms" Discussant: Isaac Sorkin
Influenza A virus subtype H5N1 clever mensurate of correlation, showing that, every bit the championship says, high wage workers travel for companies that pay high average wages, together with also depression wage workers travel for companies that pay depression wages. This seems obvious, but it has non been inwards the data. The previous approach to this interrogation by Abowd, Kramarz together with Margolis (1999) establish no correlation. Influenza A virus subtype H5N1 big intelligence near correlation vs the AKM regression estimate. It turns out the Definition of correlation is real subtle, together with depends on the form of search model y'all convey inwards mind.
Ellen McGratten asked a precipitous question: Wait, if a trouble solid outsources its janitors, does this non spike? Really nosotros are learning near the boundaries of the firm. Answer yes, together with actually nosotros desire to know whether high wage people travel amongst other high wage people. More intelligence near what the fact agency near 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 near repairing the ridiculously huge estimates of financial multipliers inwards New-Keyensian models at the zip bound. There is a lot going on including heterogenous agents amongst financing constraints, which I can't review.
Here's ane matter I learned from it -- naturally related to the issues I convey idea near inwards this context inwards "the new-Keynesian liquidity trap" here. Building on an before newspaper yesteryear Hagedorn, they posit a money-like need for authorities debt. Thus they convey nominal debt/price storey = business office of something real. Like the financial theory, inwards which nominal debt/price storey = expected acquaint value of existent surpluses, together with similar MV=PY, this tin laissez passer notice decide the toll level, together with so choice equilibria. They choice equilibria amongst express inflation jumps, which similar the financial theory serves to trammel the size of the green 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 forwards than primal 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 item 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 belike missed one-half of it. Solve, tally a bunch of facts, analyze a crisis together with policy alternatives.
6) John Kennan, "Spatial Variation inwards Higher Education Financing together with the Supply of College Graduates" Discussant:Danny Yagan
Different states subsidize college didactics to dissimilar degrees. Does having a bully province academy pay off, inwards that y'all acquire a meliorate workforce? Or produce your graduates only all travel out to New York together with travel for investment banks, or to Palo Alto to travel for Google? Apparently not.
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