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Juan Pablo Nicolini, profesor del Departamento de Economía, y a Pablo Kurlat, graduado de UTDT, publicaron su trabajo en The American Economic Review

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“ Unconventional Fiscal Policy at the Zero Bound”

Isabel Correia, Emmanuel Farhi, Juan Pablo Nicolini and Pedro Teles

Abstract: When the zero lower bound on nominal interest rates binds, monetary policy cannot provide appropriate stimulus. We show that, in the standard New Keynesian model, tax policy can deliver such stimulus at no cost and in a time-consistent manner. There is no need to use inefficient policies such as wasteful public spending or future commitments to low interest rates.

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“Lemons Markets and the Transmission of Aggregate Shocks”

Abstract:I study a dynamic economy featuring adverse selection in asset markets. Borrowing-constrained entrepreneurs sell past projects to finance new investment, but asymmetric information creates a lemons problem. I show that this friction is equivalent to a tax on financial transactions. The implicit tax rate responds to aggregate shocks, generating amplification in the response of investment and cyclical variation in liquidity.