Marcus Hagedorn
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View article: The Impact of Unemployment Benefit Extensions on Employment: The 2014 Employment Miracle?
The Impact of Unemployment Benefit Extensions on Employment: The 2014 Employment Miracle? Open
We measure the aggregate effect of unemployment benefit duration on employment and the labor force. We exploit the variation induced by Congress' failure in December 2013 to reauthorize the unprecedented benefit extensions introduced durin…
View article: An Equilibrium Theory of Nominal Exchange Rates
An Equilibrium Theory of Nominal Exchange Rates Open
This paper proposes an equilibrium theory of nominal exchange rates, which offers a new perspective on various issues in open economy macroeconomics. The nominal exchange rate and portfolio choices are jointly determined in equilibrium, th…
View article: Differential Fiscal Policy Induced Innovations in Consumer Markets
Differential Fiscal Policy Induced Innovations in Consumer Markets Open
Many consumer goods - sugar, cigarettes, alcohol, fossil fuels - are considered sin goods as they cause externalities like CO2 emissions or internalities such as addiction. The standard response is then to appeal to the Pigouvian principle…
View article: Corona Policy According to HANK
Corona Policy According to HANK Open
In this note, we analyze the role of the European Central Bank through the lens of the Heterogenous-agent New Keynesian Model (HANK), a new paradigm of fiscal and monetary policy that abandons the assumption of perfectly functioning financ…
View article: The Fiscal Multiplier
The Fiscal Multiplier Open
We measure the size of the fiscal multiplier using a heterogeneous agents model with incomplete markets, capital and rigid prices and wages. This environment captures all elements that are considered essential for a quantitative analysis. …
View article: Forward Guidance
Forward Guidance Open
We assess the power of forward guidance-promises about future interest rates-as a monetary tool in a liquidity trap using a quantitative incomplete-markets model.Our results suggest the effects of forward guidance are negligible.A commitme…
View article: Prices and Inflation when Government Bonds are Net Wealth
Prices and Inflation when Government Bonds are Net Wealth Open
In this paper I show that models in which government bonds are net wealth - that is, their value exceeds that of tax liabilities (Barro, 1974) - offer a new perspective on several issues in monetary economics. First and foremost, prices an…
View article: Identifying Equilibrium Models of Labor Market Sorting
Identifying Equilibrium Models of Labor Market Sorting Open
We assess the empirical content of equilibrium models of labor market sorting based on unobserved (to economists) characteristics. In particular, we show theoretically that all parameters of the classic model of sorting based on absolute a…
View article: A Demand Theory of the Price Level
A Demand Theory of the Price Level Open
In this paper I propose a theory of a globally unique price level based on the simple idea that the price equates demand with supply in the goods market. Monetary policy through setting nominal interest rates, e.g. an interest rate peg, an…
View article: Interpreting Recent Quasi-Experimental Evidence on the Effects of Unemployment Benefit Extensions
Interpreting Recent Quasi-Experimental Evidence on the Effects of Unemployment Benefit Extensions Open
We critically review recent methodological and empirical contributions aiming to provide a comprehensive assessment of the effects of unemployment benefit extensions on the labor market and attempt to reconcile their apparently disparate f…