Global Institute working papers

 

• Working Paper

  The Micro and Macro Dynamics of Capital Flows

  This paper studies empirically and theoretically the effects of international financial flows on resource allocation.

  August 01, 2025

• Working Paper

  Analysis of Multiple Long-Run Relations in Panel Data Models

  This paper proposes a novel methodology that filters out the short-run dynamics using sub-sample time averages as deviations from their full-sample counterpart, and estimates the number of long-run relations and their coefficients using eigenvalues and eigenvectors of the pooled covariance matrix of these sub-sample deviations.

  June 05, 2025

• Working Paper

  Bubbling Up? What Consumer Expectations Reveal About U.S. Housing Market Exuberance

  This paper investigates the presence of speculative bubbles in the U.S. housing market after the global financial crisis. Unlike standard approaches that rely on observed economic fundamentals, the method used in this paper leverages subjective price expectations from the University of Michigan Survey of Consumers to test for exuberance without imposing a specific model of intrinsic housing values.

  May 21, 2025

• Working Paper

  Global Macro-Financial Cycles and Spillovers

  This paper develops a new dynamic factor model to jointly characterize global macroeconomic and financial cycles and the spillovers between them.

  April 22, 2025

• Working Paper

  Tempting FAIT: Flexible Average Inflation Targeting and the Post-COVID U.S. Inflation Surge

  In August 2020, the Federal Reserve adopted Flexible Average Inflation Targeting (FAIT), permitting inflation to temporarily exceed the 2% target. Using synthetic control methods, this paper estimates that FAIT raised headline CPI inflation by 1 percentage point and core CPI by 0.5 percentage points, relative to a no-FAIT-adoption counterfactual, with short-lived effects concentrated during the 2021 inflation surge.

  April 09, 2025

• Working Paper

  Living Up to Expectations: The Effectiveness of Forward Guidance and Inflation Dynamics Post-Global Financial Crisis

  This paper studies the effectiveness of forward guidance when central banks face private agents with heterogeneous expectations allowing for a degree of bounded rationality.

  April 03, 2025

• Working Paper

  Trade Costs and Inflation Dynamics

  Using bilateral trade flows from detailed global input-output data and a gravity framework, this paper estimates trade cost shocks and their effects on CPI inflation.

  March 04, 2025

• Working Paper

  An Anatomy of U.S. Establishments’ Trade Linkages in Global Value Chains

  Global value chains (GVC) are a pervasive feature of modern production, but they are hard to measure. Using U.S. Census microdata, this paper develops novel measures of the linkages between U.S. manufacturing establishments’ imports and exports. The paper documents three new GVC patterns.

  December 27, 2024

• Working Paper

  Structural Change in Sub-Saharan Africa: An Open Economy Perspective

  This paper studies the evolution of manufacturing value-added shares in 11 sub-Saharan African (SSA) countries through the lens of an open economy model of structural change.

  December 24, 2024

• Working Paper

  Real Exchange Rates and the Global Financial Cycle

  This paper looks at the effect of fluctuations in the global financial cycle on real exchange rates.

  November 26, 2024