Michael Boutros

Michael Boutros

PhD Candidate in Economics

Duke University

Welcome to my website. I’m a fifth-year PhD candidate in economics at Duke University. My research interests are in macroeconomics and finance, with an emphasis on anticipating, preventing, and mitigating recessions.

Before beginning my PhD, I was a Research Assistant in the Financial Markets Department (Monetary Policy Analysis and Research Team) at the Bank of Canada. Prior to that, while studying economics as an undergraduate at the University of Toronto, I worked in an administrative role at the Bank of Montreal and as a freelance programmer for various organizations.

Curriculum Vitae


  • Fiscal and Monetary Policy
  • Household Finance
  • Bounded Rationality


  • PhD in Economics, 2016–

    Duke University

  • MA in Economics (en route to PhD), 2019

    Duke University

  • BSc in Financial Economics, 2015

    University of Toronto

Job Market Paper

Bounded Intertemporal Rationality and the Marginal Propensity to Consume January 2021.
Michael Boutros

I build a model that generates large and realistic marginal propensities to consume for constrained and unconstrained households. The main mechanism in the model is bounded intertemporal rationality. Households respond to irregular income shocks by re-optimizing over an optimally determined finite horizon. The optimal length of the horizon depends on the size and persistence of the shock relative to the household’s income and wealth. Estimated using data from the Economic Stimulus Act of 2008, the model explains the large consumption response of financially unconstrained households and generates a distribution of propensities to consume similar to the empirical distribution. The main implication for the design of stimulative policy is to target smaller payments to more households along the income distribution.

Working Papers

Evaluating the Impact of Economic Impact Payments December 2020.
Michael Boutros

As part of the CARES Act, the IRS distributed $300 billion in Economic Impact Payments (EIPs) directly to US households. In the Census Bureau’s Household Pulse Survey (HPS), almost 75% of households receiving an EIP reported mostly spending it. Conditioning on labor status, 63% of employed households reported mostly spending their EIPs, compared to 84% of unemployed households. Both types of households reported spending largely on consumption goods, but unemployed households tended to pay regular bills while employed households paid down debt or increased savings. The evidence suggests that in designing an untargeted stimulus program and trading off potential efficacy for timeliness, Economic Impact Payments were overall very effective in supporting consumer spending.

The Persistence of Miscalibration November 2020. R&R at The Review of Financial Studies.
Michael Boutros, Zahi Ben-David, John Graham, Campbell Harvey, John Payne

Using 14,800 forecasts of one-year S&P 500 returns made by Chief Financial Officers over a 12-year period, we track the individual executives who provide multiple forecasts to study how their beliefs evolve dynamically. While CFOs’ return forecasts are systematically unbiased, their confidence intervals are far too narrow, implying significant miscalibration. We find that when return realizations fall outside of ex-ante confidence intervals, CFOs’ subsequent confidence intervals widen considerably. These results are consistent with a model of Bayesian learning which suggests that the evolution of beliefs should be impacted by return realizations. However, the magnitude of the updating is dampened by the strong conviction in beliefs inherent in the initial miscalibration and, as a result, miscalibration persists.

Household Finances and Fiscal Stimulus in 2008 June 2019.
Michael Boutros

Using detailed household-level data from the Survey of Income and Program Participation, the ratio of credit card debt to income is found to be the most important balance sheet item in determining household usage of stimulus funds in 2008, adding to existing evidence that borrowing constraints are functions of debt-to-income ratios. Borrowing constrained households, often predicted to be the group with the largest propensity to consume out of stimulus funds, were the most likely to use stimulus payments to repay debt instead of increase consumption. This behavior is consistent with the fact that household credit supply was tightening at the same time that stimulus payments were being distributed, forcing households, especially those near their borrowing constraints, to deleverage.

The Information Effect of Monetary Policy December 2018.
Michael Boutros

A large empirical literature documents that central bank monetary policy changes signal information about future economic fundamentals to the private sector. The canonical Gali (2008) model is modified to analyze this mechanism and understand the information effect of monetary policy. We assume the central bank observes a private signal of future economic fundamentals and uses the filtered information in its Taylor rule. As a result, the nominal interest rate serves an additional function as a noisy signal of future economic fundamentals and there is an information effect of monetary policy. We find that a contractionary monetary policy induces an expansionary information effect, but for reasonable calibrations, the net effect is contractionary.

Works in Progress

The Prevalence and Relevance of Credit Card Borrowing February 2020.
Michael Boutros

In 2016, one in three US households reported carrying monthly balances on their credit cards. The prevalence of credit card borrowing implies that summarizing a household’s liquidity using net liquid wealth masks important heterogeneity in joint holdings of liquid assets and debt. I show that credit card borrowing is an important predictor of household behavior in response to transitory income shocks. Holding fixed net liquid wealth, the propensity to consume and save decrease with more credit card debt and the propensity to repay debt increases. This finding has implications for the propagation of income shocks in the economy.


Monetary Policy Implementation in a Negative Rate Environment Journal of Money, Credit & Banking, 52 (2-3), March-April 2020, p. 441-470.
Michael Boutros, Jonathan Witmer

To analyze monetary policy implementation in a negative rate environment, we add the option to exchange central bank reserves for cash to the standard workhorse model of monetary policy implementation (Poole 1968). Importantly, we show that monetary policy can be constrained when the target overnight rate is below the yield on cash. At this point, the overnight rate equals the yield on cash instead of the target rate. Modifications to the implementation framework, such as a reserve requirement that varies with cash withdrawals, can help restore the implementation of monetary policy such that the overnight rate equals the target rate.

Formerly Bank of Canada Staff Working Paper 2017-25.


Duke University

  1. ECON490: The Macroeconomic Impact of COVID19 (Instructor, Summer 2020)
  2. ECON613: Applied Econometrics in Microeconomics (TA, Spring 2018)
  3. ECON490: Advanced Macroeconomics: Monetary and Fiscal Policies (TA, Fall 2017)

University of Toronto

  1. ECO208: Macroeconomic Theory (TA, 2014-2015)
  2. Economics Study Centre (Head Peer Mentor, 2014-2015; Peer Mentor, 2013-2014)