Three Essays in Macroeconomics and International Economics.

housing and inequality;Chinese economy andtransition path;fiscal uncertainty and welfare costs;wealth inequality and distributional effects;sovereign defaults and debt renegotiations;strategic interaction between debtors and creditors;Economics;Business and Economics;Social Sciences;Economics

Zhang, FudongKimball, Miles S ;

University of Michigan

关键词: housing and inequality;    Chinese economy andtransition path;    fiscal uncertainty and welfare costs;    wealth inequality and distributional effects;    sovereign defaults and debt renegotiations;    strategic interaction between debtors and creditors;    Economics;    Business and Economics;    Social Sciences;    Economics;   

Others  :  https://deepblue.lib.umich.edu/bitstream/handle/2027.42/133190/fudongzh_1.pdf?sequence=1&isAllowed=y

瑞士|英语

来源: The Illinois Digital Environment for Access to Learning and Scholarship

【 摘 要 】

Chapter 1 studies the interaction between inequality and house prices using an incomplete market heterogeneous agent model. The model links cross-sectional household portfolio saving decisions to housing market outcomes, contributing to the housing literature by illustrating a new price formation mechanism in which the investment motive among the wealthy plays a key role. A quantitative application of the theory rationalizes puzzling phenomena in China – notably, its recent substantial housing boom accompanied by rising savings rates. The theory in this paper shows that market frictions can have differential impacts cross-sectionally, increasing the risk of an explosion of inequality. This adds to the understanding of a broader topic: how inequality and macroeconomic forces can interact.Chapter 2 explores the welfare and distributional effects of fiscal uncertainty in a neoclassical stochastic growth model with incomplete markets, where households face uninsurable idiosyncratic risks in their labor income and discount factor processes. Aggregate uncertainty arises from both productivity and government purchases shocks. Starting from an initial situation calibrated to key features of the U.S. economy, we eliminate government purchases shocks but keep the aggregate productivity process. We then evaluate the distributional consequences of the elimination of fiscal uncertainty and find, in the baseline case, welfare gains that decline with private wealth holdings.Chapter 3 offers new theoretical and empirical insights into the effect of sovereign defaults on trade. We contend that sovereign debt renegotiation is associated not with trade sanction but with trade benefit between debtor countries and creditor countries. We find empirical support for the argument from the changes in trade share after debt renegotiations as well as the Aid-for-trade statistics.We build a two-country DSGE model with incomplete market to explain why trade sanction is not observed. We reason that creditors lower trade costs with debtors in hope to collect the remaining debt during debt renegotiations. The adjustment, in turn, affects debtors;; default decisions. The model departs from the existing literature on sovereign defaults by introducing the strategic interaction between debtors and creditors. We solve the model numerically to determine the optimal trade costs given different combinations of debt and income levels.