CQER Working Papers

CQER Working Papers feature the research of visiting scholars and distinguished economists. The papers are intended to stimulate professional discussion and exploration of quantitative economic research. Online only.


How Sticky Wages in Existing Jobs Can Affect Hiring

Mark Bils, Yongsung Chang, and Sun-Bin Kim
CQER Working Paper 14-4 (August)
The authors consider a matched model of employment in which wages are flexible for new hires but "sticky"—negotiated infrequently—for current employees. The paper departs from the literature on the topic, with firms and workers negotiating over effort and output.

The Decline of the U.S. Rust Belt: A Macroeconomic Analysis

Simeon Alder, David Lagakos, and Lee Ohanian
CQER Working Paper 14-5 (August)
Why did the Rust Belt fare worse than other parts of the country after World War II? The authors propose that a lack of competition in labor and output markets was behind the area's poor economic performance.

Measuring the Macroeconomic Impact of Monetary Policy at the Zero Lower Bound

Jing Cynthia Wu and Fan Dora Xia
CQER Working Paper 2014-2 (June)
The authors propose an extremely tractable model for analysis of an economy operating near the zero lower bound for interest rates. They show that this model can be used to summarize the macroeconomic effects of unconventional monetary policy at the zero lower bound.

Optimal Tax Progressivity: An Analytical Framework

Jonathan Heathcote, Kjetil Storesletten, and Giovanni L. Violante
CQER Working Paper 2014-3 (June)
What shapes the optimal degree of progressivity of the tax and transfer system? The authors develop a tractable equilibrium model that considers policy and structural parameters and other trade-offs.

Intergenerational Redistribution in the Great Recession

Andrew Glover, Jonathan Heathcote, Dirk Krueger, and José-Víctor Ríos-Rull
CQER Working Paper 14-01 (January)
The authors analyze the distributional consequences of a large recession across different age cohorts. They find that asset price declines hurt the old, who rely on asset sales to finance consumption, but benefit the young, who can purchase assets at depressed prices.

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