Research 

Work - in - progress

Hand-to-Mouth agents and Fiscal Policy Effects - with Pedro Brinca, Tiago Bernardino & Valter Nobrega

Public Debt and Fiscal Policy Transmission

Working Papers

Risk Aversion and Fiscal Consolidation Programs, 2021, PDF

Abstract. In this paper we provide evidence that there are statistical and economically meaningful differences in terms of attitudes towards risk at the aggregate level across countries, as captured by country-specific estimations of the coefficient of relative risk aversion. This has important implications for fiscal policy as it leads to large differences in the output response to the same fiscal policy shock. When calibrating the risk aversion at the country level, using country-specific estimates of the coefficient of relative risk aversion, we find multipliers to the same fiscal consolidation shock to differ as much as between 0.35 and 0.55.