Working Papers

The Geography of Wealth: Shocks, Mobility, and Precautionary Savings (with Maximiliano Dvorkin)

The spatial distribution of wealth in the United States is very heterogeneous. We study the spatial distribution of wealth in a country and how it is shaped by regional earning characteristics and mobility frictions. For this, we develop a tractable model of consumption, savings, and location choice with many regions, incomplete markets, and heterogeneous agents facing persistent and transitory income shocks. Our theory extends a workhorse macroeconomic model of consumption and savings under uncertainty to an economy with multiple labor markets and costly mobility. Despite complex spatial and individual heterogeneity, we characterize the optimal consumption, savings, and mobility decisions of workers in closed form. Mobility frictions increase precautionary savings as workers hedge against consumption fluctuations generated by moving decisions. The spatial distribution of wealth is primarily driven by the interaction between persistent income shocks, saving behavior, and worker sorting over locations. Our results highlight the importance of accounting for worker mobility and regional heterogeneity in earnings dynamics when studying the spatial distribution of wealth.

Are We Consuming Too Much Groundwater? (with Joseph Shapiro and Katherine Wagner)

We study the optimality of human groundwater extraction from many of the world’s 3,400 aquifers, where institutional or market failures may produce non-optimal extraction decisions. We use remote sensing and economic data to estimate a dynamic model of water extraction for each aquifer, recover the discount factor that rationalizes observed groundwater extraction, and compare it against Ramsey and market benchmarks. Three- to four-fifths of aquifers are extracted more rapidly than is optimal, decreasing aquifer present value by several percent, and creating trillions of dollars in present value welfare losses. Policies that guarantee users constant water quantities indefinitely, through subsidies or prior appropriation, or policy rules that fully discount future extraction, generate larger welfare costs. A sustainable extraction path that maintains current fill forever generates meaningfully lower welfare than the optimal extraction path, because most aquifer stocks are already inefficiently low.

Under Revision

Homeownership and the Distributional Effects of Local Shocks
Review of Economic Studies,  Revise and Resubmit

Dynamic Urban Economics (with Andrii Parkhomenko and Stijn Van Nieuwerburgh)
American Economic Review,  Revise and Resubmit

Publications

Housing Constraints and Spatial Misallocation: Comment
American Economic Journal: Macroeconomics, Volume 18, Number 2, April 2026.

Demand, Growth, and Deleveraging (with Conor Walsh).
Review of Economic Dynamics, Volum 51, December 2023.

Can Self-Help Groups Really be 'Self-Help'? (with Joseph Kaboski and Evan Van Leemput).
Review of Economic Studies, 83 (2016): 1614-1644.
Appendix

Selected Work in Progress

Work from Home and the Evolution of Cities (with Andrii Parkhomenko and Stijn Van Nieuwerburgh)

Land Use Regulation, Homeownership, and the Cost of NIMBYism (with Christian Hilber, Hans Koster, Gabriel Loumeau, and Andrii Parkhomenko)