Curriculum Vitae

Job Market Paper:

"When are the Effects of Fiscal Policy Uncertainty Large?"

I argue that fiscal policy uncertainty can have large and adverse effects when the monetary authority is constrained by the zero lower bound on nominal interest rates. Using a new-Keynesian model with endogenous capital accumulation, I show that uncertainty about short-run and long-run fiscal policy can cause large falls in consumption, investment, and output when the zero lower bound binds, but has modest effects when it does not. I study uncertainty about the level of government spending and uncertainty about tax rates on consumption, dividends, wages, profits, capital, and investment. In my model, uncertainty about government spending and the wage tax rate has particularly large effects. I present VAR evidence indicating that shocks to policy uncertainty have had larger effects on the U.S. economy during the Great Recession, a period in which the Federal Reserve's policy rate has been at its effective lower bound, than in the preceding years.

Past Publications:

"Are Long-Run Inflation Expectations Anchored More Firmly in the Euro Area Than in the United States?" With Meredith Beechey and Andrew Levin. American Economic Journal: Macroeconomics, Vol. 3, No. 2, 2011.

This paper compares the evolution of long-run inflation expectations in the euro area and the United States, using evidence from financial markets and surveys of professional forecasters. Survey data indicate that long-run inflation expectations are reasonably well anchored in both economies but reveal substantially greater dispersion across forecasters' long-horizon projections of US inflation. Analysis of daily data on inflation swaps and nominal-indexed bond spreads, which gauge compensation for expected inflation and inflation risk, also suggests that long-run inflation expectations are more firmly anchored in the euro area than in the United States.

References:

Prof. Martin S. Eichenbaum (Committee Chair)
Prof. Lawrence J. Christiano
Prof. Sergio T. Rebelo
Prof. Giorgio E. Primiceri