Thesis advisor: Pablo Guerron-Quintana / This thesis consists of two self-contained essays on topics in applied macroeconomics. In the first chapter, I study how heterogeneous sensitivities to weather fluctuations and interregional production networks impact the measurement of weather shocks’ impact on economic activity in the United States. I start the analysis by building a general equilibrium model where the impact of weather fluctuations on productivity is state-sector dependent, and networks expose sectors to weather shocks from other regions through the use of intermediate inputs. Then, I quantify the relevance of these mechanisms, combining the model’s predictions with annual data on sectoral GDP and average temperatures by state from 1970 to 2019. My estimates show that models that do not consider these characteristics underestimate the aggregateimpact of weather fluctuations by at least a factor of 3. In particular, when the whole economy faces an unexpected increase in temperature of 1 Celsius degree, the contraction in economic activity increases from -0.13 to -0.37 percent once heterogeneity is considered and -1.14 percent when networks are included. In the second chapter, I propose a new methodology to disentangle between terms of trade movements caused by global shocks and those resulting from country-specific terms-of-trade fluctuations. This methodology extends the so-called maximum-share approach in two ways. Firstly, a global shock is identified as the shock with the highest explanatory power on the forecast error variance of a set of exogenous variables. This is in contrast to the typical approach of using only one variable as a source of information to identify a shock. Secondly, country-specific terms-of-trade shocks are identified as shocks that satisfy two conditions: (i) maximum explanation power on terms-of-trade variability and (ii) orthogonality to global shocks, allowing me to isolate the main drivers of terms of trade that are not related to global fluctuations. I apply this methodology to data on ten small open economies(SOEs) and show that global shocks contribute - on average- to 33 percent of their business cycle fluctuations. The contribution of global shocks to terms-of-trade variability is close to 20 percent, meaning that around 80 percent of terms-of-trade movements have country-specific origins. Interestingly, on average, country-specific terms-of-trade shocks are responsible for less than 10 percent of SOE business cycle variability. These results help to reconcile current estimates on the importance of terms of trade and suggest an intensive evaluation of the origins of terms-of-trade movements by policymakers before any intervention. / Thesis (PhD) — Boston College, 2024. / Submitted to: Boston College. Graduate School of Arts and Sciences. / Discipline: Economics.

[pt] Esta tese é composta por três artigos. O primeiro deles estuda os impactos de longo prazo de uma política de colonização implementada no estado de São Paulo. Ao final do século 19, quase 30 assentamentos coloniais foram criados no estado, colônias caracterizadas como vilas rurais, formadas por pequenos lotes de terra e povoadas por imigrantes europeus relativamente mais educados. Características únicas deste episódio nos permitem mostrar empiricamente que estes assentamentos estão associados ao desenvolvimento de longo prazo das regiões de colonização via especificamente o canal de capital humano. O segundo artigo examina em que medida choques idiossincraticos de precipitação durante o peródo de gestação afetam saúde infantil ao nascer e educação de alunos da escola primária no Semiárido nordestino. Os resultados mostram que choques climáticos adversos diminuem o peso ao nascer, e causam uma maior incidência de mortalidade infantil. Também encontramos impactos negativos sobre aprendizado, evasão e reprovação escolar. O terceiro artigo investiga o impacto da violência associada ao tráfico de drogas no Rio de Janeiro sobre o desempenho educacional em escolas mais expostas aos conflitos entre facções criminosas. Os resultados indicam que violência tem um impacto causal negativo sobre desempenho escolar em matemática, enquanto que nenhum efeito é encontrado sobre o desempenho em português. Também encontramos que a violência é associada a probabilidades mais altas de reprovação e evasão. / [en] This thesis is comprised of three empirical articles. The first article studies the long run development impacts of a colonization policy undertaken by public authorities in the Brazilian state of São Paulo. By the late 19th century, almost 30 settlement colonies were created across São Paulo, Neo Europes characterized as rural villages formed by small plots of land and populated by relatively higher-skilled European settlers. The unique features of this colonialism episode enable us to support empirically the view that settlement colonies fostered long run development of settled regions through improvements in early levels of human capital. The second article examines to what extent idiosyncratic weather patterns during the time in utero have affected infant health at birth and educational outcomes in the Semiarid Northeast Brazil.We build two parallel databases. The first one is a municipality by month of birth database that combines site-specific rainfall uctuations before birth with infant health and mortality rates. The second one combines the same weather outcomes with student level data on school attainment and achievement. We find statistically signifficant evidence that areas hit by negative rainfall uctuations experience higher incidence of low birth weight, preterm gestation and infant mortality rates. We also find that adverse rainfall uctuations when in utero are associated with lower academic test scores, higher incidence of delayed enrollment, dropout and grade repetition among young primary school students. The third article investigates whether and how armed conict among drug gangs in Rio de Janeiro s slums affect children s educational outcomes. We explore time and geographical variation in localized violent events in order to identify causal effects of exposure to violence on students achievement test scores and mobility across schools. We find that students from schools close to areas that experience more violence over time perform worse in standardized math exams, while no significant effect is found for language exams. Violence is also associated with higher grade repetition and dropout rates.