Research

Research Interests

Macro Labor, Quantitative and Theoretical Macroeconomics, Heterogeneous Agents

Working Papers

The Labor Market Effects of Loosely Attached Workers and Short-Term Jobs

What are the macroeconomic consequences of the recent decline in short-term jobs in the U.S.? The answer depends on who is taking these jobs. I document just 10% of individuals account for 50% of transitions in and out of the labor force and 36% of the stock of workers in unemployment. I develop a calibrated model of dual labor markets with a long-term search sector and a short-term spot market that can account for these facts. Within the model, a 50% decline in short-term jobs from reduced labor demand will increase unemployment by 60% but barely affect participation.

Populism, Protectionism, and Trade Policy, joint with Sebastian Galiani and Gustavo Torrens

Most populist regimes in Latin American countries used trade policy to redistribute income, despite being less efficient than other redistribution schemes, such as transfers financed with an income tax. Often, this outcome is attributed to the endemic lack of fiscal capacity in Latin American countries. Instead, we develop a simple political economy game where the populist government may use trade policy to encourage capitalists to invest in the more labor-intensive industry. Since moving capital is costly, those capitalists will support the continuation of the protectionist trade policy even after the populist government falls from power. The populist government may therefore choose to implement the less efficient but politically-sustainable policy instead of the more efficient policy that will be easily overturned after a regime change. Building fiscal capacity does not change the equilibrium. Only a long run commitment to a minimum level of redistribution restores efficiency.