Research
Publications
"Labor Mobility in a Monetary Union", with Martin Seneca
Journal of International Economics, Volume 137, July 2022
Previous version: Bank of Canada Working Paper 2019-15
See also our blog-entry in BankUnderground
"Housework and Fiscal Expansions", with Stefano Gnocchi and Evi Pappa
Journal of Monetary Economics, Volume 79, May 2016, Pages 94–108
Previous version: Bank of Canada Working Paper 2014-34
Working Papers
"Time Use and Macroeconomic Uncertainty", with Matteo Cacciatore and Stefano Gnocchi (The Review of Economics and Statistics, accepted for publication.)
NBER Working Paper 31954 (December 2023)
We estimate the effects of economic uncertainty on time use and discuss its macroeconomic implications. Using data from the American Time Use Survey, we first infer cyclical variation in home production and leisure time. We then document that higher uncertainty increases housework and reduces market hours worked, with modest effects on leisure. Finally, we propose a model of housework with time-varying uncertainty that quantitatively accounts for these results. We use the model to demonstrate that substitution between market and non-market work provides an additional insurance margin to households, weakening precautionary savings and labor supply. However, time-use reallocation also lowers aggregate demand, ultimately amplifying the contractionary effects of uncertainty. Policies that reallocate time use toward housework (e.g., lockdown restrictions) amplify the recessionary effects of uncertainty and can result in aggregate dynamics consistent with a supply-side shock.
"Fiscal spillovers: The case of US corporate and personal income taxes", with Romanos Priftis and Madeline Hanson (reject and resubmit at the Journal of Applied Econometrics)
This paper extends the identification of unanticipated changes in average federal corporate and personal income tax rates in the United States, as proposed in Mertens and Ravn (2013), to the end of 2019, and assesses their propagation to economies with tight links to the US economy. While cuts in both taxes lead to significant short-run expansions in the US economy, their spillover effects on other countries differ markedly. A cut in corporate taxes can produce negative spillovers, indicating that the contractionary effects associated to the reallocation of investment and jobs by multinational firms outweigh the potential positive effects of increased demand for country-specific goods through trade with the US. The spillover effects of lower personal income taxes are more heterogeneous across countries but are, on average, expansionary, depending on the country-specific monetary policy stance.
"Technology Shocks, Labor Mobility and Business-Cycle Fluctuations" (2nd round R&R at JMCB)
This paper documents the dynamic behavior of interstate net labor flows after positive shocks to state-specific labor productivity. The average fall in state-level employment and net labor flows suggested by the data masks important heterogeneity in conditional dynamics at the state level. While some U.S. states attract workers as productivity surges, others experience periods of negative net migration. This heterogeneity is mediated by state economies' industry composition, that maps into measures of nominal rigidities through differences in industry-specific frequencies of price adjustments. Heterogeneity in state-level price rigidities generates large differences in employment dynamics and is key in explaining the dynamic patterns of interstate labor flows. A two-region model with labor mobility and region-specific shocks, calibrated to realistic interstate differences in nominal rigidities, accounts for this evidence.
Previous version: Bank of Canada Working Paper 2014-4
Work in Progress
"Macroeconomic implications of price and liability dollarization", with Kostas Mavromatis
"Income and Consumption Tax Multipliers: Narrative Evidence from Canada", with Rodrigo Sekkel