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.

In the U.S., student debt is currently the second largest component of consumer debt. Households are required to repay these loans early in their lifecycle, when marginal utility is particularly high. We study alternative contracts that offer partial or full payment deferral until later in life. We calibrate an economy with the current contracts, and then solve for counterfactual equilibria. The alternative contracts yield large welfare gains, which are robust to assumptions about the behavior of the lenders and borrower preferences. The gains are similar to those that could come from the debt relief program currently being considered in the U.S., but without its adverse fiscal implications.

I study how the cognitive demands of financial planning shape household decisionmaking with respect to consumption out of windfall income shocks. I build a quantitative model of bounded rationality in which reoptimization is costly. Households respond to windfall income shocks by choosing a finite planning horizon over which to reoptimize, and the optimal planning horizon is increasing in wealth and the magnitude of the income shock. Calibrated to U.S. data, the model's distribution of consumption responses is consistent with three key facts: even highly liquid households have large consumption responses out of income shocks, the fraction of households with positive consumption responses increases with shock size, and conditional on responding, larger shocks generate smaller consumption responses.

We analyze a panel of over 28,400 S&P 500 return forecasts by CFOs to examine whether the extent of CFOs' miscalibration—providing forecast confidence intervals that are too narrow—decreases over time. We find no improvement with task repetition nor evidence of learning, that is, no improvement in response to past performance. Across CFOs, miscalibration appears to be a persistent personal trait. We find some evidence that the degree of miscalibration is related to birth cohort and stock market familiarity.

We study how households choose between three mortgage contracts with different payment structures: fixed-rate fixed-payment, variable-rate variable-payment, and a hybrid variable-rate fixed-payment mortgage where interest rate changes affect principal repayment rather than payment size. This hybrid contract, which is offered in only a few countries around the world, insures the household's payment while exposing it to the risk of larger future mortgage balances. We model these mortgage types simultaneously and decompose the welfare from offering each contract into aggregate risk, idiosyncratic risk, and lifecycle factors. Payment structure interacts with contract length because lenders must be compensated for locking a rate over a longer term, but not for fixing a payment, favoring the hybrid contract over traditional contracts as term lengthens.

Around one-third of U.S. households are coholders with both liquid assets and revolving credit card debt, yet macroeconomic models typically summarize their balance sheets by net liquid wealth. We show that, holding net liquid wealth fixed, the underlying gross positions of liquid assets and debt are important determinants of how households consume, save, and deleverage out of transitory income gains. In particular, households with more debt consume less and deleverage more. We build a model that reproduces these patterns through endogenous coholding generated by a liquidity-in-advance constraint and use it to show that coholding changes standard conclusions about fiscal and monetary policy. Accounting for coholders reverses the prediction that targeting transfers to low-income households generates more immediate consumption than untargeted transfers because many targeted households use transfers to repay debt. Coholding also weakens monetary transmission through saving rates and strengthens it through borrowing rates.

Rent control keeps rent from falling during downturns because landlords cannot quickly restore the previous rent. I test this mechanism using Toronto's surprise 2018 exemption of new buildings from rent control and the COVID-19 pandemic as a temporary demand shock. Rent fell approximately 6.5% for Controlled units and 10.9% for exempt Flexible units in nearly identical buildings across the cutoff. Under the benchmark of perfect substitutability, a two-sector model implies rent would have fallen roughly 15.3% absent rent control, more than twice the Controlled decline. This rent burden falls on tenants, whom rent control is designed to protect.

We study how local climate risk affects nationwide housing markets. We develop a dynamic spatial equilibrium housing model with migration and property insurance channels, in which heterogeneous households choose location, housing tenure, and insurance coverage across regions differently exposed to climate shocks. The model generates realistic under-insurance and coverage heterogeneity across wealth, age, and regions, which interact with migration to determine climate risk exposure in the population. Our counterfactual experiments show, first, that housing prices endogenously reflect local risk and insurance costs where housing supply is imperfectly elastic. Therefore, the geographic distribution of households changes only slightly due to climate risk, suggesting that adaptation through migration has positive but limited benefits in equilibrium. Second, we evaluate popular insurance pricing policies designed to address the resulting rise in insurance costs and the protection gap. A subsidy to insurers that lowers the cost of high coverage and is financed by local homeowners meaningfully reduces climate risk exposure in the population. Alternative policies either increase exposure or generate large wealth transfers across regions.

When borrowers are present-biased, mandating faster debt repayment can raise welfare if lost access is worth less than the internality it corrects. We study a Quebec mandate raising credit card minimum payments to 5 percent of balances. Applying synthetic difference-in-differences to credit reporting data, we estimate revolving debt falls 26 percent, delinquencies rise but defaults do not, and credit access tightens. Borrowers repay more than required, consistent with bias correction. But issuers ration credit, so some deleveraging is involuntary; a sufficient-statistics framework separating the two implies welfare rises unless lost access is worth over $16 to $54 per Quebec consumer.

This paper analyzes the tradeoff between targeted versus timely fiscal stimulus payments in a quantitative two-sector HANK model. In response to a negative sectoral shock, fiscal policy is specified as the total size of transfers, the degree of targeting towards households in the affected sector, and the number of periods until the policy can be implemented. The key trade-off in the model is that the degree of targeting is increasing in the delay until policy can be implemented. In the baseline calibration of symmetric equilibrium with one household wholly employed in each sector, the key result is that fully targeting the stimulus program to the household in the affected sector yields less total welfare than intermediate levels of targeting.

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, almost 75% of households receiving an EIP reported using it to mostly pay for expenses. Separating respondents based on labor income interruptions, 84% of unemployed households reported mostly spending their EIPs, compared to 63% of employed households, suggesting that the benefits of more targeted direct transfers may have been limited, especially at the expense of timeliness. Overall, I conclude that Economic Impact Payments played an important role in stabilizing aggregate spending.