Research

"Inflation in disaggregated small open economies" 

This paper studies inflation in small open economies with production networks. I show that the production network alters the elasticity of the consumer price index (CPI) to changes in sectoral technology, factor prices, and import prices. Sectors can import and export directly but also indirectly through domestic intermediate input-output linkages. Indirect exporting dampens the inflationary pressure from domestic forces, such as adverse sectoral technology shocks and increases in factor prices. In contrast, indirect importing increases the inflation sensitivity to import price changes. Computing these CPI elasticities requires knowledge of the production network structure as these do not coincide with typical sufficient statistics used in the literature, such as sectoral sales-to-GDP ratios (Domar weights), factor shares, or imported consumption shares. Using input-output tables, I provide empirical evidence that adjusting CPI elasticities for indirect exports and imports matters quantitatively for small open economies. I then use the model to illustrate the importance of production networks during the recent COVID-19 inflation in Chile and the United Kingdom.

"Commodity prices and production networks in small open economies" 

with Petre Caraiani, Jorge Miranda-Pinto, and Juan Olaya-Agudelo

"Startup employment and career trajectories" 

with Gonzalo Garcia-Trujillo and Nathalie Gonzalez-Prieto

"Pandemic-era inflation drivers and global spillovers" 

with Julian di Giovanni, Sebnem Kalemli-Ozcan, and Muhammed A. Yildirim. 

"Optimal monetary and exchange rate policy in disaggregated small open economies"

"Business cycle asymmetry and Input-Output structure: The role of firm-to-firm linkages" 

with Jorge Miranda-Pinto and Eric R. Young. 

Journal of Monetary Economics, 137, pp. 1 - 20, 2023.

"Quantifying the inflationary impact of fiscal stimulus under supply constraints" 

with Julian di Giovanni, Sebnem Kalemli-Ozcan, and Muhammed A. Yildirim. 

American Economic Association Papers and Proceedings, 113, pp. 76 - 80, 2023.

"Global supply chain pressures, international trade, and inflation" 

with Julian di Giovanni, Sebnem Kalemli-Ozcan, and Muhammed A. Yildirim. 

Conference Proceedings ECB Forum: Challenges for monetary policy in a rapidly changing world, 2022.

"Price controls, hyperinflation, and the inflation relative-price variability relationship" 

with Rodrigo Cerda and Rolf Luders

Empirical Economics, 61(4), pp. 1725-1748, 2021.

"Impact of economic uncertainty in a small open economy: the case of Chile" 

with Rodrigo Cerda and Jose Tomas Valente

Applied Economics, 50(26), pp. 2894-2908, 2018.

"Towards measuring economic policy uncertainty in Latin America: a first little step"

Latin American Policy Journal, 7, pp. 68-73, 2018.

"School funding in Chile" 

with Sergio Urzua

In Ideas en educacion II: definiciones en tiempos de cambio, chapter 7 (in Spanish), 2018.