This article surveys the macroeconomic implications of financial frictions. Financial frictions
lead to persistence and when combined with illiquidity to non-linear amplification effects …

Forward exchange rate unbiasedness is rejected in tests from the current floating exchange
rate era. This paper surveys advances in this area since the publication of Hodrick's (1987) …

Macro-finance addresses the link between asset prices and economic fluctuations. Many
models reflect the same rough idea: the market's ability to bear risk is greater in good times …

We investigate the consumption consequences of the 2006–9 housing collapse using the
highly unequal geographic distribution of wealth losses across the United States. We …

We show that housing markets provide information about the appropriate discount rates for
valuing investments in climate change abatement. Real estate is exposed to both …

Rising home values also raise the cost of living, offsetting their impact on consumption.
However, additional home equity collateral can loosen borrowing constraints, increasing …

What shapes the optimal degree of progressivity of the tax and transfer system? On the one
hand, a progressive tax system can counteract inequality in initial conditions and substitute …

Discount‐rate variation is the central organizing question of current asset‐pricing research. I
survey facts, theories, and applications. Previously, we thought returns were unpredictable …

ABSTRACT I study aggregate consumption dynamics under incomplete markets, focusing
on the relationship between consumption and the path for interest rates. I first provide a …

Using a representative online panel from the United States, we examine how individuals'
macroeconomic expectations causally affect their personal economic prospects and their …