We study how an aggregate bank flow shock impacts German cities' GDP growth depending on the state of their local real estate markets. Identification exploits a policy framework assigning refugees to cities on a quasi-random basis and variation in non-developable area for the construction of a...

This paper analyzes optimal regulation to address the issue of “Too Big To Fail” (TBTF) in a simple model with government bailouts. Due to the commitment issue of government bailouts, a combination of capital requirement and size regulation can only achieve a second-best allocation, where...

Over the past two decades, emerging market economies have improved their external liability structures by increasing the share of debt denominated in local currencies, while foreign currency debt is considered a major source of financial instability. This paper embeds the debt denomination...

Over the past two decades, emerging market economies have improved their liability structures by increasing the share of their debt denominated in local currency. This paper embeds the debt denomination choice in a sudden stop model and explores how this alternative structure sheds new...

We study how a capital flow shock impacts German cities' GDP growth depending on the state of their local real estate markets. Identification exploits a policy framework assigning refugees to cities on a quasi-random basis and variation in non-developable area for the construction of a measure...

Stock market liberalization generates benefits and costs. We estimate these effects using the Shanghai (Shenzhen) - Hong Kong Stock Connect, an important opening that allows foreign investors to trade a subset of mainland Chinese firms. The liberalization brought connected Chinese firms lower...

Who should be responsible for industry regulation, a private self-regulatory agency or a public agency? This paper provides a simple framework to analyze the optimal scope of a private self-regulatory organization (SRO) versus government regulation. The trade-off depends on three key elements:...

We examine the immediate effects and bounce-back from six modern health crises: 1968 Flu, SARS (2003), H1N1 (2009), MERS (2012), Ebola (2014), and Zika (2016). Time-series models for a large cross-section of countries indicate that real GDP growth falls by around three percentage points in...

This paper reviews selected post-Global Financial Crisis theoretical and empirical contributions on capital controls and identifies three theoretical motives for the use of this policy tools: pecuniary externalities in models of financial crises, aggregate demand externalities in new-Keynesian...

This paper reviews selected post-Global Financial Crisis theoretical and empirical contributions on capital controls and identifies three theoretical motives for the use of capital controls: pecuniary externalities in models of financial crises, aggregate demand externalities in new-Keynesian...