The City of London after Brexit
In March 2017 the UK government will apply for Article 50 of the Lisbon Treaty to end its membership in the European Union. This unprecedented step...
Monetary Easing and Financial Instability
We study optimal monetary policy in the presence of financial stability concerns. We build a model in which monetary easing can lower the cost of...
Collateral Constraints and Asset Prices
We study the effects of collateral constraints in an economy populated by investors with nonpledgeable labor incomes and heterogeneous preferences and...
Why macropru can end up being procyclical
Discretionary macroprudential policies aim to be countercyclical by adjusting risk-taking across the financial cycle. This column argues that the...
The fatal flaw in macropru: It ignores political risk
Political risk is a major cause of systemic financial risk. This column argues that both the integrity and the legitimacy of macroprudential policy...
Ties that Bind: How Business Connections Affect Mutual Fund Activism
Journal of Finance, 71(6), 2933-2966.
The Anatomy of the CDS Market
Using novel position and trading data for single-name corporate credit default swaps (CDSs), we provide evidence that CDS markets emerge as...
What is the Expected Return on a Stock?
We derive a formula that expresses the expected return on a stock in terms of the risk-neutral variance of the market and the stock’s excess risk...
Systemic Risk and the Dynamics of Temporary Financial Networks
This paper has two main objectives: first, to provide a formal definition of endogenous systemic risk that is firmly grounded in equilibrium dynamics...
On K-Class Discounted Stochastic Games
For a discounted stochastic game with an uncountable state space and compact metric action spaces, we show that if the measurable-selection-valued...
Stationary Markov Equilibria for Approximable Discounted Stochastic Games
We identify a new class of uncountable-compact discounted stochastic games for which existence of stationary Markov equilibria can be established and...
The Divergent Postcommunist Paths to Democracy and Economic Freedom
This paper presents evidence from 29 postcommunist countries that the economic transition has been more successful than the political transformation...
