This dissertation examines three topics in macroeconomics. The first chapter studies the impact of severance payments on employment when firms can subcontract as a substitute for hiring workers. In countries with strict job security regulations firms use flexible staffing arrangements to buffer the regular workforce from economic fluctuations and avoid workers' firing costs. I set up a general equilibrium model in the tradition of Hopenhayn and Rogerson (1993) where firms can hire two types of workers: subcontractors that are totally flexible, and permanent workers that entail firing costs that increase with seniority in the job. Both types are perfect substitutes in production, but permanent workers are relatively less expensive as subcontractors' charges are higher than the firm's own production costs. I estimate the model using a simulated method of moments by fitting employment growth dynamics of Chilean manufacturing plants. I find that allowing firms to subcontract workers increases output, employment and productivity. This effect is stronger on output as subcontracted workers allow firms to respond more aggressively to productivity shocks, which enhances the allocation of labor across firms and hence total factor productivity (TFP). When firms can subcontract, the negative effects of firing costs are less than previously estimated in the literature. The second chapter analyzes the effects of capital adjustment costs on quantity dynamics and asset prices in a real business cycle model when the representative agent has Epstein-Zin preferences. Capital adjustment costs make it costly for agents to smooth fluctuations in consumption through the production sector, inducing them to take more consumption risk. I show this model accounts for the main statistical features of macroeconomic aggregate quantities. At the same time, adjustment costs increase the equity risk premium, with the mean stock return and its standard deviation in the order of magnitude consistent with the data. The model also produces a stable risk-free rate, and comes close to matching its average return. Finally, the third chapter (with Shuheng Lin) empirically examines the contribution of firm-level idiosyncratic shocks to aggregate fluctuations in the US, Germany, Canada, and the UK. We find shocks to large firms are of little relevance in the UK or Canada, but roughly explain one third of output fluctuations in the US and Germany. We argue the ability of the largest firms to transmit shocks is not universal, even when the firm size distribution is highly skewed as the theory suggests (Gabaix, 2011).

Chapter 1- How well-off or worse-off a country can be by joining a currency union in the presence of structural heterogeneity and idiosyncratic shocks? In light of the proposed creation of a currency union for the Economic Community of the West African States (ECOWAS), we develop a three-region DSGE model to explore the question. We divide the ECOWAS into three regions-Nigeria, the existing WAEMU (West-African Economic Monetary Union), and the rest. Considering two monetary regimes (monetary union and monetary independence), we assess the heterogeneity in the responses to country-specific productivity and terms-of-trade shocks in these two regimes, as well as the costs related to the loss of monetary independence. Our results indicate that shocks hitting a given region generate cross-border spillover effects, whose sign and magnitude depend not only on the nature of the disturbance but also on its origin and on the monetary policy regime considered. Moreover, the propagation of shocks across regions is magnified under the monetary union regime. Shocks hitting Nigeria's economy tend to have a more destabilizing effect on the other regions, especially when they are inside the union. Our results also suggest that the proposed monetary union for the ECOWAS region can potentially lead to welfare improvement for all the members, but the magnitude of the welfare gain is relatively small. Chapter 2- In this chapter, we develop a multi-region New-Keynesian Dynamic Stochastic General Equilibrium (DSGE) of the West-African countries to provide a quantitative analysis of intergovernmental fiscal transfers in the context of the proposed creation of a monetary union. We assess the potential role of fiscal transfers in the stabilization of business cycle fluctuations in the projected monetary union in the presence of idiosyncratic shocks. Starting from a baseline scenario with no fiscal transfers among the regions, we analyze the dynamic and welfare impacts of full and partial fiscal equalization schemes with nominal tax revenue sharing within the union. We consider adverse productivity and term-of-trade shocks. Our simulation results suggest that the transfer mechanism is an efficient stabilizing tool. However, the stabilization property of the fiscal transfer system hinges upon the full or partial nature of the compensation system. Moreover, the ability of the transfer system to absorb the negative effects of idiosyncratic shocks depends not only on the type of shock but also on the size of the region directly affected. Chapter 3- We analyze in this chapter the macroeconomics effects of fiscal policy shocks in the Economic Community of West African States (ECOWAS). To that end, we use a Global Vector Autoregression (GVAR) model, which allows us to assess both the within country and the cross borders spillover effects of the fiscal shocks. For the dynamic analysis, we consider negative country-specific public spending and revenue shocks affecting Nigeria as well as regional public spending and revenue shocks affecting two groups of countries in the area, namely the West African Economic and Monetary Union (WAEMU) and the Rest of ECOWAS (RECOWAS). We provide evidence of considerable cross-country heterogeneity in fiscal spillovers; for instance, spillovers are high for fiscal shocks affecting Nigeria, while the cross-border spillover effects on Nigeria are weak for shocks affecting WAEMU and RECOWAS. Our results also suggest that fiscal policy is very relevant in stimulating real output in each of the ECOWAS countries but limited for the cross-country output stimulation.

Dans cette thèse, les déterminants des trajectoires éducationnelles et professionnelles des jeunes dans les pays en développement sont examinés, avec un accent particulier mis sur les relations au sein du ménage. Le premier chapitre fournit une revue des contributions théoriques et empiriques de la littérature autour du concept de transition de l'éducation au marché du travail dans les pays en voie de développement. Le deuxième chapitre développe un modèle d'équilibre général calculable, appliqué de manière rétrospective à l'économie de la Malaisie, dans l'optique d'étudier les conséquences sur le marché du travail du progrès technique biaisé et d'une politique éducative de masse. Les chapitres suivants s'interrogent sur les interactions au sein des ménages et leurs impacts lors de chocs. Un accent est ici mis sur le travail des enfants ainsi que sur leur scolarisation. Les résultats soulignent d’importantes externalités et une absorption hétérogène des chocs au niveau des ménages. L'évaluation de politiques publiques gagnerait à tenir compte de ces externalités intra-ménage. / This thesis seeks to promote our understanding of the constraints and opportunities facing youth as they transit through schooling and to the labor market. The first chapter provides a literature review of the theoretical and empirical contributions to what we know about school-to-work transitions in developing countries and their specificities. The following chapter builds a computable general equilibrium model that is applied to the Malaysian labor market, in order to study the impact of skill-biased technological change and educational policy on labor market evolutions. Subsequent chapters examine household interactions arising from exogenous shocks, from the angle of children’s work and schooling. The findings from these chapters point to the presence of important spillover effects and heterogeneous absorption of shocks in the household. Impact evaluation of policy would therefore benefit from the systematic incorporation of such household-level externalities.

Les trois essais composant cette thèse apportent des contributions à la littérature sur les conséquences de la migration et des transferts privés sur le développement économique des pays d'origine d'Afrique Subsaharienne.Le premier essai évalue l'impact distributif des transferts internationaux et domestiques au Sénégal. Les résultats montrent que les transferts privés réduisent l'inégalité de revenu au Sénégal. Cet effet égalisateur semble principalement tiré par les transferts domestiques. Le deuxième essai examine la fonction d'assurance de la migration au Mali. Nous trouvons que la migration agit comme un mécanisme d'assurance lorsque le ménage est victime d'un choc idiosyncratique au cours de l'année. Le troisième essai étudie le lien entre le capital humain des migrants sénégalais et leur insertion sur le marché de travail de destination. Les résultats suggèrent que la probabilité d'être en emploi qualifié étant donné le niveau d'éducation est inférieure en migration par rapport au Sénégal.Bien qu'à priori distincts, ces trois essais ont en commun une approche qui mobilise des enquêtes ménages ainsi que des techniques micro-économétriques diverses au regard du caractère complexe de la migration afin d'apporter des éclairages sur les conséquences de la migration sur les économies d'origine. / The three essays composing this thesis make contributions to the literature on the consequences of migration and private transfers on the economic development of the countries of origin of sub-Saharan Africa.The first essay evaluates the distributive impact of international and domestic transfersin Senegal. The results show that private transfers reduce income inequality in Senegal. This equalizing effect is mainly driven bydomestic transfers. The second essay examines the insurance function of migration in Mali. We find that migration acts as an insurance mechanism when the household suffers an idiosyncratic shock during the year. The third essay examines the link between the human capital of Senegalese migrants and their integration into the destination labor market. The results suggest that the probability of being in skilled employment given the level of education is lower in migration compared to Senegal. Although a priori distinct, the three essays have in common an approach that mobilizes household surveys and various microeconometric techniques to deal with the complexity of migration in order to improve the understanding of the consequences of migration on the economies of origines

A decade of growth and wealth generation in Russia ended in 2009 with the collapse in GDP and rising unemployment. This Great Recession added new economic challenges to the ‘old’ problems facing children and families, including widening income inequalities and the phenomenon of social orphanage. One question is how the new and existing material pressures affect parent–child relationships. This research contributes to the answer by examining, in aggregate terms, the role poverty plays in the allocation of parental time in this emerging economy. Utilising a nationally representative sample of children, it explores how child interactions with parents are affected by aggregate and idiosyncratic shocks. Drawing on the rational choice paradigm and its critique, we put forward the Parental Time Equilibrium as an analytical guide to the study. This theoretical approach presents individual decisions concerning time spent with children over the long term as the product of a defined equilibrium between resources and demands for involvement. We test this approach through pooled cross-sectional and panel analyses based on the Russian Longitudinal Monitoring Survey dataset from 2007 to 2009. Children in low-income households face the double disadvantage of a lack of money and time investments at home, with both persistent and transient poverty being associated with lower than average parental time inputs in the sample. Moreover, while on average, we find that children do maintain the amount of time they spend with their parents under conditions of severe financial strain, low–income children lose out on play time with the mother. Material resources cannot be considered in isolation from structural disadvantages, of which rural location in particular is detrimental for parent–child time together. The study demonstrates that the cumulative stress of adverse macro-economic conditions and depleted material resources makes it difficult for parents to sustain their human investment in children. The evidence this study provides on the associations between economic stress and pa-rental time allocations advances our knowledge of the disparities of in the childhood experience in modern Russian society. The findings strongly support the equal importance of available resources and basic demand for involvement, thus drawing policy attention to the need to address both in the best interests of children.

Diese Dissertation befasst sich mit Arbeitsmarkterfolg und Konsum sozioökonomischer Gruppen. Die ersten zwei Kapitel untersuchen konjunkturelle Auswirkungen auf Arbeitsmärkten für Hoch- und Niedrigqualifizierte. Zunächst wird ein qualifikationsspezifisches Konjunkturmodell mit Suchkosten entworfen. Es zeigt, dass imperfekte Substitution zwischen hoch- und niedrigqualifizierter Arbeit ein Grund für Veränderungen auf den Teilmärkten ist. Gemeinsam mit qualifikationsneutralen und -verzerrten Technologieschocks ist das Modell in der Lage, fallende Beveridge-Kurven zu generieren. Das zweite Kapitel erweitert diesen Ansatz um eine Verbindung zwischen qualifikationsabhängigen Arbeitsmärkten mit endogenen Investitionen in Humankapital. Idiosynkratische Schocks wirken auf den Anteil qualifizierter Arbeit und verändern die Arbeitsmarktdichte auf den Teilmärkten. Neutrale Schocks wirken zweistufig auf die Gesamtarbeitslosigkeit: Zuerst reduzieren sie geringqualifizierte Arbeitslosigkeit, und dann verringern sie rapide hochqualifizierte Arbeitslosigkeit. Eine hohe Substitutions-Elastizität zwischen den beiden Qualifikationen führt zu einer höheren Volatilität und einer höheren Korrelation zwischen Arbeitslosigkeit und freien Stellen. Das dritte Kapitel untersucht die Verbindung zwischen Gruppen-Konsumwachstum und dessen Volatilität, wenn die Agenten heterogen sind und eine Konsumexternalität vorliegt. Die Präferenzen der Haushalte hängen mit der Konsumwachstumsvolatilität insofern zusammen, als diese Vermögensentscheidungen treffen müssen: Die Volatilität verringert sich mit der Geduld und steigt mit dem Wunsch, das Konsumniveau der Vergleichsgruppe zu halten. Darüber hinaus sollten Konsumwachstum und dessen Volatilität positiv korrelieren. Diese letzte Hypothese wird mit Daten aus dem Sozio-oekonomischen Panel und der Einkommens- und Verbrauchsstichprobe überprüft, wobei sich ein U-förmiger Zusammenhang zwischen Konsumwachstum kurzlebiger Güter und dessen Volatilität ergibt. / This dissertation addresses the labor market performance and consumption dynamics of different socioeconomic groups. The first part examines the connection between cyclical variations in skilled and unskilled labor markets. Using a business cycle model with search frictions in skill-specific markets, I find that imperfect substitution between skilled and unskilled labor creates an important channel for variations in the skill-specific markets. Together with a skill-neutral or -biased technology shock, the model generates downward-sloping Beveridge curves in aggregate and skill-specific labor markets. I extend the study to allow for a dynamic link between the skill-specific labor markets. Human capital investment is determined endogenously and idiosyncratic shocks shift the skilled labor share and change tightness in both skilled and unskilled markets. Upon a neutral shock, the decrease of total unemployment is two-staged: Firstly with a reduction in unskilled unemployment, and then with a sharp decline of skilled unemployment when skill substitution dominates. A larger elasticity of substitution between the two types of labor leads to higher volatility of the model variables and higher correlation between unemployment and vacancies. The second part studies the link between group-specific consumption growth and its volatility in a framework of heterogeneous agents, under the assumption of a consumption externality. Household preferences are related to the consumption growth volatility through asset holding decisions: The volatility decreases with groups'' patience, and increases with the eagerness to keep up with the group average. Moreover, consumption growth is expected to be positively related to its volatility. This last hypothesis is tested using household data imputed from the German Socio-Economic Panel and the German Income and Expenditure Survey, where a U-shaped relationship is found between nondurable consumption growth and its volatility.

This dissertation collects four essays on banks, firms and real effects of bank lending. Owing to the appliance of different econometric methods on several datasets, insights in the behav-ior of and the impacts from financial markets and market participants are generated. In the first chapter, our results uncover a so far undocumented ability of the interbank market to distinguish between banks of different quality in times of aggregate distress. We show empirical evidence that during the 2007 financial crisis the inability of some banks to roll over their interbank debt was not due to a failure of the interbank market per se but rather to bank-specific shocks affecting banks’ capital, liquidity and credit quality as well as revised bank-level risk perceptions. Relationship banking is not capable of containing these frictions, as hard information seems to dominate soft information. In detail, we explore determinants of the formation and resilience of interbank lending relationships by analyzing an extensive da-taset comprising over 1.9 million interbank relationships of more than 3,500 German banks between 2000 and 2012. The second chapter examines the relationship between central bank funding and credit risk-taking. Employing bank-firm-level data from the German credit registry during 2009:Q1-2014:Q4, we find that banks borrowing from the central bank rebalance their portfolios to-wards ex-ante riskier firms. We further establish that this effect is driven by the ECB’s maturi-ty extensions and that the risk-taking sensitivity of banks borrowing from the ECB is inde-pendent of idiosyncratic bank characteristics. Finally, we show that these shifts in bank lend-ing are associated with an increase in firm-level investment and employment, but also with a deterioration of bank balance sheet quality in the following year. Once we analyze the relationship of banks as lenders vis-à-vis banks as borrowers and banks as lenders vis-à-vis non-financial companies as borrowers, we enlarge the understand-ing of non-financial companies not only in terms of being simply borrowers, respectively sub-jects exhibiting of credit risks. Instead, we try to understand the inner working of those com-panies more generally and analyze their quality not only in terms of a bank’s risk assessment but also in terms of the overall market assessment. However, this in turn can generate infor-mation useable to assess the quality of a bank’s credit portfolio in dimensions that so far are not taken into account by the current regulatory framework. Moreover, a better understanding of banks and non-banks beyond the standard lens of the banking and corporate finance litera-ture might promote new scopes for future research connecting those discrete subjects. In this regard, the third chapter analyzes the dependence of price reactions to corporate insider trad-ing on several measures of corporate governance quality. Our results strongly support the view that first, higher corporate governance levels seem to prevent or discourage insiders from engaging in insider trading as means of opportunistic rent extraction. Second, results confirm the notion of buy and sell trades not being just two sides of the same coin. That is, a higher level of corporate governance leads to a better pre-event information environment which results in less positive abnormal returns after insider buy trades as the incremental posi-tive information revealed by the trade is smaller. In contrast, sell trades in firms with better corporate governance are perceived to convey more valuable and most importantly negative information to the capital market so that prices adjust more for companies with better govern-ance schemes. Third, we show that institutional ownership even on an aggregate level is a sufficient measure to proxy a company’s corporate governance level. Hence, as information on companies’ bylaws and on investors’ investment dedication and type for example are scarce, respectively associated with higher costs because one has to gather that information one can refrain from that and instead proxy the governance level with the aggregate measure of institutional ownership. The latter result is important for carrying out future analyses merg-ing and extending the findings of the first two chapters. Last, the fourth chapter abstracts from borrowers as subjects of credit risk, as well, and most importantly extends the analysis of banks, firms and their interactions effecting each other by a macroeconomic perspective of the real effects of bank lending. That is, as capital flows and real estate are pro-cyclical, and real estate has a substantial weight in economies’ income and wealth Chapter 4 studies the role of real estate markets in the transmission of bank flow shocks to output growth across German cities. In this regard, real sector firms play a central role in the transmission mechanism we uncover. More specifically, the empirical analysis relies on a new and unique matched data set at the city level and the bank-firm level. To measure bank flow shocks, we show that changes in sovereign spreads of Southern Eu-ropean countries (the so-called PIGS spread) can predict German cross-border bank flows. To achieve identification by geographic variation, in addition to a traditional supply-side varia-ble, we use a novel instrument that exploits a policy assigning refugee immigrants to munici-palities on an exogenous basis. We find that output growth responds more to bank flow shocks in cities that are more exposed to tightness in local real estate markets. We estimate that, during the 2009-2014 period, for every 100-basis point increase in the PIGS spread, the most exposed cities grow 15-2 basis points more than the least exposed ones. Moreover, the differential response of commercial property prices can explain most of this growth differen-tial. When we unpack the transmission mechanism by using matched bank-firm-level data on credit, employment, capital expenditure and TFP, we find that firm real estate collateral as measured by tangible fixed assets plays a critical role. In particular, bank flow shocks in-crease the credit supply to firms and sectors with more real estate collateral. Higher credit supply then leads firms to hire and invest more, without evidence of capital misallocation.