Essays in macroeconomics and finance

Abstract/Contents

Abstract

This thesis consists of three chapters on macroeconomics and finance. The first chapter investigates the effects of large swings in the exchange rate on aggregate economic activity and inequality among households. The literature lacks a consensus on these questions. I document new stylized facts from Swiss administrative data on how the large and unexpected appreciation of the Swiss Franc in January 2015 affected households across income and wealth distributions. I then develop a quantitative model consistent with these facts to measure the welfare implications of this appreciation across the distribution and evaluate the effects of alternative monetary policy actions by the Swiss National Bank around this event. The second chapter is co-authored with Adrien Auclert, Hannes Malmberg and Matthew Rognlie. We use a sufficient statistic approach to quantify the general equilibrium effects of population aging on wealth accumulation, expected asset returns, and global imbalances. Combining population forecasts with household survey data from 25 countries, we measure the compositional effect of aging: how a changing age distribution affects wealth-to-GDP, holding the age profiles of assets and labor income fixed. In a baseline overlapping generations model this statistic, in conjunction with cross-sectional information and two standard macro parameters, pins down general equilibrium outcomes. Since the compositional effect is positive, large, and heterogeneous across countries, our model predicts that population aging will increase wealth-to-GDP ratios, lower asset returns, and widen global imbalances through the twenty-first century. These conclusions extend to a richer model in which bequests, individual savings, and the tax-and-transfer system all respond to demographic change. The final chapter provides a historical decomposition of business cycles in Switzerland. First, I construct historical national accounts data from 1890 to 2018. Second, I apply the business cycle accounting procedure to decompose economic fluctuations into four wedges that capture different underlying frictions. In the Great Depression and the 1920 recession, the efficiency wedge helped the economy escape a massive downturn implied by the labor wedge. The reverse was observed during the 1990 recession, when the efficiency wedge implied a strong recession limited by the action of the labor wedge. The 1973 recession can primarily be explained by the efficiency wedge and, less importantly, by the investment wedge. Surprisingly, the government spending wedge, which includes fluctuations in net exports, plays a minor role in explaining business cycle fluctuations in Switzerland.

Description

Type of resource	text
Form	electronic resource; remote; computer; online resource
Extent	1 online resource.
Place	California
Place	[Stanford, California]
Publisher	[Stanford University]
Copyright date	2023; ©2023
Publication date	2023; 2023
Issuance	monographic
Language	English

Creators/Contributors

Author	Martenet, Frederic
Degree supervisor	Auclert, Adrien
Degree supervisor	Kehoe, Patrick J
Thesis advisor	Auclert, Adrien
Thesis advisor	Kehoe, Patrick J
Thesis advisor	Bocola, Luigi
Thesis advisor	Di Tella, Sebastian T
Thesis advisor	Tonetti, Christopher
Degree committee member	Bocola, Luigi
Degree committee member	Di Tella, Sebastian T
Degree committee member	Tonetti, Christopher
Associated with	Stanford University, School of Humanities and Sciences
Associated with	Stanford University, Department of Economics

Subjects

Genre	Theses
Genre	Text

Bibliographic information

Statement of responsibility	Frédéric Martenet.
Note	Submitted to the Department of Economics.
Thesis	Thesis Ph.D. Stanford University 2023.
Location	https://purl.stanford.edu/bh752cs4256

Access conditions

Copyright

© 2023 by Frederic Martenet

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