We study how uncertainty propagates through production networks. First, we construct a highly disaggregated, forward-looking measure of industry-level uncertainty using option-implied volatility data for U.S. firms. Second, we identify the effects of higher uncertainty within industries, across...

We develop a dynamic macroeconomic model in which the secular decline in real interest rates arises endogenously from rising wealth inequality. Challenging the standard "safe asset shortage" hypothesis, the model shows how falling real rates can coexist with a stable safe asset ratio--closely...

Legal claims are increasingly being considered as an alternative asset class, however, there appears to be a lack of a standard methodology for valuing litigation risk. This paper proposes a dynamic real options framework for the valuation of legal claims, explicitly incorporating the...

We estimate the return of climate adaptation by modeling the uncertain impact of global warming for extreme weather. Unexpected arrivals elevate extreme-weather risk, which leads households and firms to adapt and thereby lowering the damage of each subsequent arrival. Our approach provides...