The stochastic process for earnings is the key element of incomplete markets models in modern quantitative macroeconomics. We show that a simple modification of the canonical process used in the literature leads to a dramatic improvement in the measurement of earnings dynamics in administrative...

Post-crisis stress tests have altered banks' credit supply to small business. Banks affected by stress tests reduce credit supply and raise interest rates on small business loans. Banks price the implied increase in capital requirements from stress tests where they have local knowledge, and exit...

We present new stylized facts on bank and firm leverage for 2000-2009 using extensive internationally comparable micro level data from several countries. The main result is that there was very little buildup in leverage for the average non-financial firm and commercial bank before the crisis,...

We quantify the effect of foreign investment on productivity of acquired firms using a new firm-level database that tracks foreign ownership changes. To control for endogenous selection on unobserved firm-level characteristics, we study the differential impact of majority and minority foreign...