Research
Research
“Could Tariffs Provide a Stimulus? In Search of Elusive Benefits of Protectionism”, 2025 (job market paper)
Abstract: Motivated by the classical argument for protectionism as demand management, this paper shows two mechanisms under which temporary tariffs stimulate consumption. I show that in complete-market, small open-economy New Keynesian models with roundabout production, tariffs do not raise consumption under flexible prices or when active monetary policy follows targeting rules. The first mechanism for raising consumption requires an accommodative monetary policy toward producer price inflation under a fiscal-led price determination regime, or at the zero lower bound. It predicts that US tariffs depreciate the dollar, as observed around the "Liberation Day" tariffs. In incomplete markets, the second mechanism requires that input-output linkages amplify the impact of an appreciation of the terms of trade on improving consumption enough to offset countervailing forces from lower wages and employment. Tariffs misallocate inputs used in production, and the optimal monetary policy can be either expansionary or contractionary.
"Benchmark Index Inclusion and Sovereign Risk", 2024
Abstract: Rising global capital flows intermediated by investment funds that replicate benchmark indices—the returns of a basket of eligible assets—have raised financial stability concerns. I exploit variation in benchmarks used by investors holding bonds from the same issuer to estimate the causal effect of adding a country’s debt to benchmark indices on bond price volatility. Using micro-level data on government debt from emerging economies, I show that index inclusion insulates bond prices from changes in fundamental risk, reducing volatility. On the borrower side, benchmark inclusion encourages borrowing as the level of demand for a country’s bonds rises. However, the dampening effect of inclusion on the elasticity of demand for the bond has a countervailing impact. I develop and estimate a structural model with benchmark-driven demand and endogenous asset supply. The level effect on demand dominates, indicating that an increased supply of index-eligible assets contributes to volatility.
“Tariff Pass-through at the Dock and at the Store”, 2021
Abstract: This paper explains a high pass-through of US tariffs at the dock and a low pass-through at the store in general equilibrium in the US-China trade war in 2018. Using a model with costly distribution of traded goods and nominal frictions faced by producers and retailers, this paper demonstrates that a two-country model without retail-level nominal frictions cannot explain the low pass-through at the store quantitatively. A model with only producer-level nominal frictions requires unrealistically high distribution costs to match the data. Strategy complementarity exists for vertically related firms: exogenous tariff shocks increase downstream retail prices and create incentives for upstream producers to increase their prices. This strategic interaction boosts the tariff pass-through at the dock and helps the model to match the data.
“Tariffs on Medical Goods: Pass-through, Geography, and Aggregate Costs to the US Healthcare System” with Kang, Russ, and Waters, 2025 (submitted)
Abstract: Have recent tariffs resulted in increased costs for the US healthcare system? We examine US trade data and compile a database of statutory tariff changes. Tariffs on medical goods narrowly defined resulted in $3.4 Billion in duties assessed between February and July 2025–more than 10 times the same period in 2024, with a 55.8 percent rate of pass-through at the US border. We estimate that had medical goods imports observed in 2024 been subject to the statutory tariff levels prevailing in August 2025, assessed duties would have been $15.8 Billion, 30 times higher than those observed in real-time.
“Tariffs and the Macroeconomy” with Katheryn Russ and Sanjay Singh. Oxford Research Encyclopedia of Economics and Finance, July 2023.