This thesis aims to measure the potential effect that hurricanes have on unemployment rates in coastal counties from Texas to North Carolina. I used a panel data set that included all the county level unemployment statistics from 1990 to 2011 as well as the relevant descriptive attributes for all the storms and hurricanes that passed through these counties during that time period. I also did an event study to analyze the unemployment rate in these counties after a hurricane. The event study includes every category two hurricane and above that hit these coastal counties from 1990 to 2011.

This thesis consists of three self-contained chapters. In the first chapter, I present analytical expressions for fiscal multipliers under the Fiscal Theory of the Price Level. In the associated 'fiscal regime', taxation multipliers turn positive, while the government spending multiplier has the same functional form as its counterpart in the 'monetary regime', augmented by a nominal wealth effect. As a result, fiscal multipliers tend to be larger in the fiscal regime, with the degree of price stickiness being a key determinant of their exact sizes. I also analyze the effectiveness of money-financed fiscal stimulus. In the fiscal regime, money-financed stimulus is equivalent to a particular form of debt-financed stimulus. The effectiveness of money-financed stimulus in raising output (relative to in inflation) decreases as monetary policy becomes more responsive to inflation. In the second chapter, I analytically study the effects on economic activity from expected changes to future fiscal variables. I document four transmission mechanisms, the sizes of which depend crucially on the level of nominal rigidities. In general, news shocks to fiscal policy produce larger effects when the policy rate is unresponsive to inflation and when the fiscal authority has the power to issue unbacked nominal debt. Within this framework, I show that 'forward guidance' of fiscal policy can expand economic activity without ever increasing the real value of government debt. In the third chapter, I use the falling relative price of investment to explain the growing divergence between gross and net asset positions in the U.S. A lower investment price leads shadow banks to increase their borrowing and lending (i.e. gross balance sheet) to profit from better investment returns. Although more investment increases the capital stock, a lower investment price also lowers the replacement cost and, by extension, the per-unit market value of capital. Net asset positions remain, as a result, relatively unchanged. I present a stylized model that accounts for these facts.

Abstract not available

This thesis aims to measure the potential effect that hurricanes have on unemployment rates in coastal counties from Texas to North Carolina. I used a panel data set that included all the county level unemployment statistics from 1990 to 2011 as well as the relevant descriptive attributes for all the storms and hurricanes that passed through these counties during that time period. I also did an event study to analyze the unemployment rate in these counties after a hurricane. The event study includes every category two hurricane and above that hit these coastal counties from 1990 to 2011.

Diss.--Freie Universität, Berlin. / Bibliography: p. [137]-139.

Diss.--Freie Universität, Berlin. / Bibliography: p. [137]-139.

Thesis--Wisconsin. / Vita. Includes bibliographical references (leaves 401-406).

Thesis--Wisconsin. / Vita. Includes bibliographical references (leaves 190-192).

Thesis (Ph. D.)--University of Wisconsin--Madison, 1984. / Typescript. Vita. eContent provider-neutral record in process. Description based on print version record. Includes bibliographical references.

Thesis (Ph.D.)--Boston University / PLEASE NOTE: Boston University Libraries did not receive an Authorization To Manage form for this thesis or dissertation. It is therefore not openly accessible, though it may be available by request. If you are the author or principal advisor of this work and would like to request open access for it, please contact us at open-help@bu.edu. Thank you. / This dissertation presents three independent papers on macroeconomics. The first chapter, Durable Goods and Liquidity Constraints, studies how the presence of liquidity constraints affects the behavior of aggregate non-durable and durable expenditures in a model with transaction costs. The analysis shows that optimal consumption of non-durable goods in a model with durable goods differs from optimal consumption of non-durable goods in the standard model without durables. In particular, this chapter shows that allowing for durable goods in a model with liquidity constraints implies that non-durable goods consumption exhibits less excess sensitivity to current income while durable goods expenditures exhibits greater sensitivity. The second chapter, Stock Market Fluctuations and Consumer Spending, studies the relationship between stock market returns and consumption growth. Substantial market swings (and, in particular, a collapse in the stock market) may cause consumer spending-and hence aggregate demand-to fluctuate sharply. By decomposing the unexpected shock to stock returns into permanent and transitory components, this chapter analyzes in detail how the stock market affects consumption growth. Empirical results show that there is a different effect on consumption spending depending on the source of the stock market fluctuations. For total consumption growth, the effect of a permanent shock to the stock market return is twice the effect of a transitory shock. In addition, the magnitude of the effect of both shocks is largest for consumption of durables. The third chapter, Why Does Inflation Differ Across Countries?, attempts to explain the differences in inflation performance across countries. Earlier research has examined this topic, but it has considered only some of the factors that might be empirically important determinants of inflation rates. This chapter considers the distaste for inflation, optimal tax considerations, time consistency issues, distortionary noninflation policies, and other factors that might be empirically important determinants of inflation performance. Overall, the results suggest that institutional arrangements-central bank independence or exchange rate mechanisms- are relatively unimportant determinants of inflation performance, while economic fundamentals - openness and optimal tax considerations - are relatively important determinants. / 2031-01-01