
Insights / Research Brief•Jul 26, 2023
Exporting, Global Sourcing, and Multinational Activity: Theory and Evidence from the United States
Pol Antràs, Teresa C. Fort, Evgenii Fadeev, Felix Tintelnot
Multinational firms (MNEs) are more likely to trade not only with countries in which they have affiliates, but also with other countries within their affiliates’ region. These patterns point to firm-level scale economies that arise when the fixed costs to source from, or sell in, a market are shared across all the MNE’s plants.
Topics:
Financial Markets

Insights / Research Brief•Jul 20, 2023
Price Level and Inflation Dynamics in Heterogeneous Agent Economies
Greg Kaplan, Georgios Nikolakoudis, Giovanni L. Violante
This work offers new insights into the effects of persistent fiscal deficits on US inflation, revealing that targeted income redistribution during COVID increased short-term inflation significantly. The largest sustainable primary deficit is 4.6% of GDP, or 40% higher than current levels, dependent on how deficit spending is distributed.
Topics:
Financial Markets, Monetary Policy

Insights / Research Brief•Jul 06, 2023
Carbon Prices and Forest preservation Over Space and Time in the Brazilian Amazon
Juliano J. Assunção, Lars Peter Hansen, Todd Munson, José A. Scheinkman
With modest transfers per ton of net CO2, Brazil would find it optimal to choose policies that produce substantial capture of greenhouse gasses in the next 30 years, suggesting that the management of tropical forests could play an important role on climate change mitigation in the near future.
Topics:
Energy & Environment, Financial Markets

Insights / Research Brief•Jun 30, 2023
Monetary Policy Transmission Through Online Banks
Samuel Earnest, Isil Erel, Jack Liebersohn, Constantine Yannelis
Monetary transmission is significantly larger for online banks; compared to brick-and-mortar banks, a 100-basis point increase in the federal funds rate leads to an approximately-30-basis-point larger increase in deposit rates offered by online banks.
Topics:
Financial Markets, Monetary Policy

Insights / Research Brief•Jun 22, 2023
Finance and Climate Resilience: Evidence From the Long 1950s US Drought
Raghuram G. Rajan, Rodney Ramcharan
Areas affected by the 1950s drought where access to credit was constrained experienced sharp declines in bank lending, net emigration, and population declines. In contrast, agricultural investment and long-run productivity increased in drought-exposed areas with access to credit, even allowing some of these areas
to surpass similar areas that were unaffected by the drought.
Topics:
Energy & Environment, Financial Markets
Insights / Research Brief•Jun 20, 2023
Profitability Context and the Cross-Section of Stock Returns
Alex G. Kim, Valeri V. Nikolaev
This novel study documents the importance of contextual information for asset pricing, revealing context-adjusted profitability’s superior ability to explain expected returns, both statistically and economically, compared to conventional operating profitability.
Topics:
Financial Markets

Insights / Research Brief•Jun 20, 2023
When Cryptomining Comes to Town: High Electricity-Use Spillovers to the Local Economy
Matteo Benetton, Giovanni Compiani, Adair Morse
Households and small businesses paid an extra $204 million and $92 million annually, respectively, in Upstate New York because of increased electricity consumption from cryptominers; while in China, where electricity prices are fixed, rationing of electricity in cities with cryptomining deteriorates wages and investments.
Topics:
Energy & Environment, Financial Markets

Insights / Research Brief•Jun 14, 2023
Do You Even Crypto, Bro? Cryptocurrencies in Household Finance
Bernardo Candia, Olivier Coibion, Yuriy Gorodnichenko, Michael Weber
Cryptocurrency holders are younger, male, less likely to be white, and more libertarian relative to non-crypto holders. They also expect much higher rates of returns for crypto and perceive it as relatively safer than do other households. Information about historical returns for cryptocurrencies leads individuals to increase their desired share of crypto holdings and makes them more likely to purchase cryptocurrency.
Topics:
Financial Markets