Mishel Ghassibe
Junior Researcher (Assistant Professor), CREi
Affiliated Professor, Barcelona School of Economics
Since 2022, I am a tenure-track Junior Researcher (Assistant Professor) at CREi and Affiliated Professor at Barcelona School of Economics (BSE)
My research interests are in macroeconomics, with a particular focus on implications of production networks, firm heterogeneity and goods market frictions for monetary and fiscal policies
I am a proud Ukrainian, and was born and raised in the city of Vinnytsia
My CV can be found here.
I can be contacted at: mghassibe (at) crei.cat.
Publications
"State Dependence of Fiscal Multipliers: the Source of Fluctuations Matters" (with F. Zanetti) [final manuscript] [JME]
Journal of Monetary Economics, (2022, Vol. 132, pp. 1-23) [lead article]
Winner of the 2023 Journal of Monetary Economics Best Paper Award
Presentations (given by me): 2020 Winter Meeting of the Econometric Society (Nottingham); 2020 Econometric Society Winter School; CORE (UCLouvain); 2019 European Meeting of the Econometric Society (University of Manchester); 2019 North American Summer Meeting of the Econometric Society (University of Washington, Seattle); University of California, Berkeley (Graduate Economics Mini Symposium); Wadham Conference on State-Dependent Fiscal Policy; European Bank for Reconstruction and Development; 12th Joint French Macro Workshop (Banque de France); University of Oxford (Macroeconomics Lunchtime Seminar); International Monetary Fund (Research Department); International Monetary Fund (Fiscal Affairs Department); University of Pavia.
Coverage: Economics Observatory.
Abstract. We develop a general theory of state-dependent fiscal multipliers in a framework featuring two empirically relevant frictions: idle capacity and unsatisfied demand. Our key novel finding is that the source of fluctuations determines the cyclicality of multipliers. Policies that stimulate demand, such as government spending, have multipliers that are large in demand-driven recessions, but small and possibly negative in supply-driven downturns. Conversely, policies that boost supply, such as cuts in payroll taxes, are ineffective in demand-driven recessions, but powerful if the downturn is supply-driven. Austerity, implemented by a reduction in government consumption, can be the policy with the largest multiplier in supply-side recessions and demand-driven booms, provided elasticities of labor demand and supply are sufficiently low. We obtain model-free empirical support for our predictions by developing a novel econometric specification that allows to estimate spending and tax multipliers in recessions and expansions, conditional on those being either demand- or supply-driven.
Journal of Monetary Economics (2021, Vol. 119, pp. 21-39)
Winner of the 2020 European Economic Association Young Economist Award
Winner of the Poster Session at the 2018 ECB Sintra Forum on Central Banking
Presentations: 2020 Annual Congress of the European Economic Association (virtual); 2020 International Research Forum on Monetary Policy (ECB, Frankfurt; cancelled); 2019 European Winter Meeting of the Econometric Society (Rotterdam); Bank of England; 2019 Annual Congress of the European Economic Association (University of Manchester); CEPR-EABCN Conference on Advances in Business Cycle Analysis (Bank of Spain); XXI Annual Inflation Targeting Conference (Central Bank of Brazil); ECB Sintra Forum on Central Banking (poster session); 6th Workshop in Macro Banking and Finance (University of Sassari); Gorman Workshop (University of Oxford) .
Abstract. This paper offers novel econometric evidence on the contribution of production networks to the effect of monetary shocks on real macroeconomic variables. In particular, we construct a highly disaggregated monthly dataset on US final sectoral consumption to estimate that at least 30% of the effect of monetary shocks on aggregate consumption comes from amplification through input-output linkages, which facilitate downstream propagation of price rigidity. At the sectoral level, we find that the network effect rises in the frequency of price non-adjustment and intermediates intensity. Moreover, the network effect is highly concentrated: sectors that jointly account for 17% of our sample aggregate consumption account for 98% of the amplification. In order to develop our econometric specification, we obtain novel analytical sector-level solutions to a forward-looking New Keynesian model with asymmetric input-output linkages.
Working Papers
Winner of the Best Paper Prize at the 2022 European Winter Meeting of the Econometric Society
Presentations: 2022 ASSA/ES-NAWM; 2021 European Winter Meeting of the Econometric Society; Workshop of the Australasian Macroeconomics Society; King's College London; 2021 ECB/Cleveland Fed Inflation Conference; Claremont McKenna College; 24th Central Bank Macroeconomic Modeling Workshop (Central Bank of Chile); 2021 EEA-ESEM; 2021 Society for Economic Dynamics; 2021 Computing in Economics and Finance; 2021 International Association for Applied Econometrics Annual Conference; Banque de France; 2021 INET Networks Conference; 14th RGS Doctoral Conference in Economics; 2020 Winter Meeting of the Econometric Society (Nottingham); Kyiv School of Economics; 1st Bocconi Virtual PhD Conference; National Bank of Ukraine; University of California, Berkeley; 1st NuCamp Virtual PhD Workshop; University of Manchester; University of Oxford; University of Bath (scheduled).
Abstract. I develop a tractable sticky-price model, where input-output linkages are formed endogenously. The model delivers cyclical properties of networks that are consistent with those I estimate using sectoral and firm-level data, conditional on identified real and nominal shocks. A novel source of state dependence in nominal rigidities arises: the strength of complementarities in price setting and monetary non-neutrality increase in the number of suppliers optimally chosen by firms. As a result, the model simultaneously rationalizes the following observed non-linearities in monetary transmission. First, the model produces cycle dependence: the magnitude of real GDP’s response to a monetary shock is procyclical. This occurs because in expansions the level of productivity is high, encouraging cost-minimizing firms to connect to more suppliers, which makes pricing decisions more co-ordinated and monetary non-neutrality stronger. Second, there is path dependence: non-neutrality of real GDP is higher following previous periods of loose monetary policy. This happens as under nominal rigidities higher supply of money makes prices charged by suppliers cheap relative to the cost of in-house labor, encouraging more connections and strengthening pricing complementarities. Third, there is size dependence: larger monetary expansions make the network denser and have a disproportionally larger effect on GDP than smaller expansions. On the other hand, larger monetary contractions shrink the network and generate a disproportionally smaller decrease in GDP. Such size dependence holds even if the probability of price adjustment is state-independent.
Work in Progress
"Keynesian Micromanagement" (with F. Zanetti)
Presentations (given by me): 2023 Transpyrenean Macro Workshop, CREi Faculty Lunch, Bank of England, 2023 NBU-NBP Annual Research Conference
"A Disaggregated Economy with Optimal Pricing Decisions" (with A. Ferrari)
Awarded the 2023 Lamfalussy Research Fellowship (ECB)
"Intertemporal Pass-Through" (with B. Wanengkirtyo and I. Yotzov)
Presentations (given by me): CREi Faculty Lunch.
"Large Shocks, Networks and State-Dependent Pricing" (with A. Nakov)
Presentations (given by me): CREi Faculty Lunch.
Discussions
"Monetary Policy & Anchored Expectations - An Endogenous Gain Learning Model" (by Laura Gáti)
14th RGS Doctoral Conference in Economics
"Should We Use Linearized Models to Calculate Fiscal Multipliers?" (by Jesper Lindé and Mathias Trabandt)
Fiscal Policy Workshop (University of York, September 2019)
"Exchange Rate Pass-Through at the Sectoral Level" (by Ida Hjortsoe and John Lewis)
XXI Annual Inflation Targeting Conference (Rio de Janeiro, May 2019)
"R&D and Market Sharing Agreements" (by Jerome Dollinger, Ana Mauleon and Vincent Vannetelbosch)
1st Bocconi Virtual PhD Conference (September 2020)