Job market candidate
Tel. +34 93 542 2672
Available for Interviews at :
Simposio de la Asociación Española de Economía (SAEe), December 14-16, Barcelona, Spain
Allied Social Science Associations (ASSA), January 5-7, Philadelphia, US
Primary Fields: Macroeconomics, Monetary Economics, Labor Economics.
Secondary Fields: Applied Econometrics.
"Can Tax Cuts Restore Economic Growth in Bad Times?"(Job Market Paper)
I present empirical evidence that the effects of U.S. tax changes on output depend on the level of economic slack. Tax cuts have large effects in good times, but only small and statistically insignificant effects in bad times. The finding holds across different identification schemes, many alternative specifications, and when I consider shocks to the two largest tax categories—personal and corporate income taxes—separately. To explain the finding, I develop a search model of unemployment, in which the effect of a tax cut is small when unemployment is high. A tax cut raises the utility gain from work and thus stimulates jobseekers' job-search effort. The higher search effort reduces search frictions, which makes it less costly for firms to hire new workers, and therefore raises employment and production. When labor demand is depressed, however, the number of jobseekers per vacancy is large and search frictions do not matter much. As a result, a tax cut that raises search effort has little effect on employment and output.
"Theory Ahead of Measurement? Assessing the Nonlinear Effects of Credit Market Disuptions” with R. Barnichon and C. Matthes (CEPR working paper)
An important, yet untested, prediction of many macro models with financial frictions is that financial market disruptions can have highly nonlinear effects on economic activity. This paper presents empirical evidence supporting this prediction, and in particular that financial shocks have substantial (i) asymmetric, and (ii) state dependent effects. First, negative shocks to credit supply have large and persistent effects on output, but positive shocks have no significant effect. Second, credit supply shocks have larger and more persistent effects in periods of weak economic growth
"Is Credit Easing Viable in Emerging and Developing Economies? An Empirical Approach ” with L. Jacome H. & T. Saadi Sedik
During the global financial crisis, many central banks in advanced economies engaged in credit easing. These policies have been conceived as largely successful in reducing stress in financial markets, thus avoiding larger output losses. In this paper, we study empirically whether credit easing is also a viable policy tool to cope with banking crises in emerging and developing economies. We find that credit easing leads to a sharp increase in domestic currency depreciation, high inflation, and a substantial reduction in economic growth in a large panel of emerging and developing economies. For advanced economies, we find the effects to be benign. Our results suggest that emerging and developing economies should be cautious when using credit easing as it may fuel adverse macroeconomic repercussions.