The Dataverse Network is a great option for the distribution and long-term preservation of the data that underlies empirical studies. I like how it encourages the use of data citation standards and metadata to help describe the posted datasets. It also enables for replication studies to be readily undertaken on published work. It is a great resource for researchers. Currently, I have only one posted dataset, but I aim to increase my postings over time. Check it out!
Research Papers and Projects
- "International Capital Flows: Reliable or Fickle?," with Rupa Duttagupta, Jaime Guajardo, and Petia Topalova (IMF). 2011. World Economic Outlook. April, chapter 4: 125-163.
Abstract: This chapter analyzes international capital flows over the past 30 years to assess their predictability and their likely response to changes in the global macroeconomic environment. It finds that capital flows exhibit low persistence and that their volatility has increased over time. Across economies, net flows to emerging market economies are somewhat more volatile than those to advanced economies; across types of flow, debt-creating flows are somewhat more volatile and less persistent than others. Net capital flows to emerging market economies have been strongly correlated with changes in global financing conditions, rising sharply during periods with relatively low global interest rates and low risk aversion (or greater appetite for risk) and falling afterward. Furthermore, economies that have a direct foreign financial exposure to the United States experience an additional decline in their net capital flows in response to U.S. monetary tightening over and above what is experienced by economies that have no such direct U.S. financial exposure. This negative additional effect is larger when the U.S. rate hike is unanticipated and sharper for emerging market economies that are more integrated with global financial and foreign exchange markets, but smaller for economies with greater financial depth and relatively strong growth performance. Finally, the additional response to U.S. monetary tightening is deeper in an environment of low global interest rates and low risk aversion. These findings suggest that the eventual unwinding of globally accommodative financing conditions will, on the margin, dampen net flows to emerging market economies that have a direct financial exposure to the United States relative to those that do not, although strong growth performance in these economies can offset this negative additional effect. Thus, as economies further integrate with global financial markets, it is important to adopt policies to preserve domestic economic and financial strength to cope with variable capital flows. (Published Version, April 2011).
- "The Open Economy Consequences of U.S. Monetary Policy," with Christopher Bowdler, Economics, University of Oxford. 2011. Journal of International Money and Finance. March, vol. 30, no. 2: 309-336.
Abstract: We consider the open economy consequences of U.S. monetary policy, extending the identification approach of Romer and Romer  and adapting it for use with asset prices. Intended policy changes are orthogonalized against the economy’s expected future path, which captures any effects from open economy variables. Estimated from a set of bilateral VARs, the dynamic responses of the exchange rate, foreign interest rate, and foreign output are consistent with recent work that identifies U.S. policy via futures market changes and a priori impulse response bounds. We compare the two approaches, ﬁnding important commonalities. We also outline some advantages of our approach. (First Version, October 2005 / Published Version, September 2010).
- "The Long-Lived Effects of Historic Climate on the Wealth of Nations," with Akos Valentinyi, National Bank of Hungary, and Michael Vlassopoulos, Economics, University of Southampton
Abstract: We investigate the long-run consequences of historic climate (1730-2000) for the cross-country income distribution. Using a newly constructed dataset of temperature stretching over three centuries, we estimate a robust and significant time-varying, non-monotonic effect of temperature upon current incomes for a cross-section of 169 countries. We find a large, positive effect of 18th century temperature and an even larger, negative effect of 19th century temperature upon current incomes. When historic temperatures are introduced, the effect of current temperature on current income is insignificant. Our findings suggest that temperature's indirect effect upon income through historical channels dominates any direct contemporaneous effect. We provide evidence on one possible channel by which historic temperature affects current income that focuses on the interaction between agricultural productivity, international trade, and industrialization. (First Version, November 2009 -- CEPR Discussion Paper No. 7572, MPRA Paper No. 18701, SSRN No. 1508063 / This Version, June 2010).
- "The Empirics of International Monetary Transmission: Identification and the Impossible Trinity," with Christopher Bowdler, Economics, University of Oxford. 2010. Journal of Money, Credit, and Banking. June, vol. 42, no. 4: 679-713.
Abstract: The transmission of monetary policy across borders is central to many open economy models. Research has tried to evaluate the “impossible trinity” through estimating international interest rate linkages under alternative exchange rate regimes using realized base country interest rates. Such interest rates include anticipated and endogenous elements, which need not propagate internationally. We compare international interest rate responses under pegged and non-pegged regimes to identiﬁed, unanticipated and exogenous U.S. interest rate changes and realized U.S. interest rate changes. We ﬁnd important differences in estimated transmission from the two sets of measures – identiﬁed interest rate changes demonstrate a greater concordance with the impossible trinity than realized rate changes. (First Version, October 2006 / Published Version, October 2009).
- "Heterogeneous Bank Lending Responses to Monetary Policy: New Evidence from a Real-time Identiﬁcation," with Christopher Bowdler, Economics, University of Oxford, and Christoffer Koch, Economics, University of Oxford
Abstract: Heterogeneity in bank responses to monetary policy is consistent with an aggregate lending channel. However, estimates of bank responses are typically obtained using realized federal funds rate changes, which are endogenous to expected, macroeconomic fundamentals. As such, estimated heterogeneity can arise from expected fundamentals. Using an exogenous policy measure identiﬁed from narratives on FOMC intentions and real-time forecasts, we ﬁnd greater heterogeneity in responses. There is a much stronger monetary policy transmission to smaller banks. The shielding of lending amongst holding companies is larger using the exogenous measure. Unlike previous research, we ﬁnd that holdings of securities amplify exogenous policy transmission, while equity capital negates it. The results highlight the importance of controlling for policy endogeneity in future studies of bank lending behavior. (First Version, September 2008 / This Version, August 2009).
- "Hurricanes: Intertemporal Trade and Capital Shocks" (Nuffield College Economics Paper 2005-W22)
Abstract: Hurricanes in the Caribbean and Central America represent a natural experiment to test the intertemporal approach to current account determination. The intertemporal approach allows for the possibility of intertemporal trade, via international borrowing. Previous tests of intertemporal current account (ICA) models have typically relied upon the identification of shocks in a VAR framework with which to trace the current account response. Hurricane shocks represent exactly the kind of temporary, country-specific shock required by the theory, allowing for the intertemporal current account response to be estimated without recourse to a VAR shock decomposition. Using data on the economic damages attributable to a hurricane, I estimate the economy`s response to a hurricane-induced capital shock within a fixed effects panel model. The current account response qualitatively conforms to the S-shaped response predicted by the theory, indicating that countries are engaging in intertemporal trade. However, the exact timing and magnitude of the response differs from a standard ICA model`s smooth behavior. A hurricane which destroys capital valued at one year`s GDP pushes the current account over GDP into deficit by 5 percentage points initially. 3-8 years after such a hurricane, the current account over GDP moves into surplus at 2.7 percentage points. (First Version, November 2002 / This Version, May 2005).
- "Education and Intergenerational Mobility: Evidence from a Natural Experiment in Puerto Rico", with Elizabeth U. Cascio, Economics, Dartmouth College (Nuffield College Economics paper 2005-W21)
Abstract: The existence of intergenerational spillovers to public investments in schooling is often assumed in policy discussions regarding economic development. However, few studies to date have forwarded convincing evidence that externalities exist for developing countries. In this paper, we address this issue using the arguably exogenous schooling consequences of a major hurricane strike on Puerto Rico in the 1950s. Using data from the U.S. Census of Population for Puerto Rico, we first find that individuals on the margin of school entry at the time of the storm and residing in the most exposed regions of the island had significantly lower levels of education as adults than their counterparts in less exposed regions. Using the interaction of wind speed and age at the time of the storm as an instrument, we then find that maternal education is related to the probability that a child speaks English. Our estimates imply an additional year of education raises the probability that a child speaks English by between 4.3 and 4.5 percentage points, or approximately 24 to 28 percent. We find no conclusive evidence that parental education increases the probability that a child is enrolled, literate, or in an age-appropriate grade. On balance, these findings suggest that education is responsible at least in part for the persistence of human capital across generations. (First Version, August 2003 / This Version, April 2005).
- "Can democracy help? Growth and ethnic divisions." 2001. Economics Letters. January, vol. 70, no. 1: 121-126.
Abstract: This paper presents further empirical evidence suggestive of democracy’s positive role in ameliorating the negative growth effects of ethnic diversity in nations. However, it is shown that endogeneity problems and a direct negative growth effect of democracy place inherent limitations on the strength of policy implications which may be drawn from the evidence.