Fragmentation can then generate equilibria where countries might find it optimal to switch to yuan-denominated debt. Link to the paper: https://t.co/suZ6RCGIjl. Comments welcome!
Very happy to see my paper with Felipe Benguria and Felipe Saffie “Geopolitical Fragmentation, Sovereign Debt and Dollar Dominance” featured in the @FinancialTimes!
We outline a theory for when dollar dominance becomes fragile. We show how geopolitical fragmentation can shift countries’ trade toward yuan-linked markets, which leaves governments with dollar inherited debt but larger yuan revenues.
1/8 New NBER WP: Why do Sudden Stops hit EMs harder? We show production networks (may) amplify shocks via profits→collateral→borrowing. Joint w/ Jorge (@JorgeMirandaPi5), Eugenio (@_e_r_b), and Felipe. https://t.co/fucj5jJchD
Volatile US interest rates depress emerging market productivity by tightening collateral constraints and discouraging innovation, even when average rates do not change, from Nils Gornemann, Eugenio I. Rojas, and Felipe Saffie https://t.co/YpIbulTwtR
New paper (with Nils Gornemann and Felipe Saffie): Volatile Rates, Fragile Growth: Global Financial Risk and Productivity Dynamics. We show that volatility in U.S. interest rates has persistent effects on growth in emerging markets, but not in advanced economies. 1/4
Collateral constraints bind only in bad states, so the mechanism is asymmetric. Higher interest rate volatility generates larger swings, pushing more often into the constrained region. Losses in bad states are not offset in good ones: volatility alone lowers innovation & growth.4
📢 Call for Papers: The 2026 International Seminar on Macroeconomics (ISoM) will be held June 24–25 in Stockholm, hosted by Sveriges Riksbank
We invite submissions in quantitative macro w/ an international dimension. Deadline: Nov 12, 2025.
Submit here 👉https://t.co/nSEQuB4piq
It was a fantastic experience to present my paper "Connected for Better or Worse: The Role of Production Networks in Financial Crises" at the NBER Summer Institute (IFM). This is joint work with my great team @JorgeMirandaPi5, Felipe Saffie and @Asilvub. 1/n
Many thanks to the organizers Pablo Ottonello and Vincenzo Quadrini for putting our paper in the program. Also, thanks to @cesarspa1 for a great and helpful discussion, and to the audience for thoughtful comments, questions and suggestions! 2/n
Call for Papers!!! The next workshop on intl. capital flows and financial policies will take place in Paris on September. Please RT!
https://t.co/lipR406VkH
I'm happy to share that I will join @UFEconomics as a visiting AP this fall. 🐊 I'm excited to be back stateside: reach out if you'd like to connect! (Photo credit: UF)
1/🧵 New Working Paper!
Studying the macroeconomics of fixed cost models requires solving the PDE governing the dynamic distribution: the *Kolmogorov Forward Equation*
In this paper, I solve the PDE analytically 👨🏫