Working papers from the Global Institute provide critical insights on trade, immigration, and other major international issues, along with in-depth analysis of monetary policy challenges affecting the U.S. economy and its deep financial and economic ties with Mexico.
Working Paper
Dollar Funding Fragility and Non-U.S. Global Banks
Global non-U.S. banks have significant dollar exposure both on and off their balance sheet. This paper develops a model to analyze their adjustment to dollar funding shocks, whether from reduced direct lending or external dollar shortages.
August 12, 2025
Working Paper
A History of U.S. Tariffs: Quantifying Strategic Trade-Offs in Tariff Policy Design
U.S. tariff policy has historically balanced competing goals—revenue, protection and reciprocity. Policy priorities have shifted over time in response to changing economic and political conditions. Using a calibrated general equilibrium model, this paper illustrates these trade-offs through the lens of tariff Laffer curves.
August 05, 2025
Working Paper
The Micro and Macro Dynamics of Capital Flows
This paper studies empirically and theoretically the effects of international financial flows on resource allocation.
August 01, 2025
Working Paper
Analysis of Multiple Long-Run Relations in Panel Data Models
This paper proposes a novel methodology that filters out the short-run dynamics using sub-sample time averages as deviations from their full-sample counterpart, and estimates the number of long-run relations and their coefficients using eigenvalues and eigenvectors of the pooled covariance matrix of these sub-sample deviations.
June 05, 2025
Working Paper
Bubbling Up? What Consumer Expectations Reveal About U.S. Housing Market Exuberance
This paper investigates the presence of speculative bubbles in the U.S. housing market after the global financial crisis. Unlike standard approaches that rely on observed economic fundamentals, the method used in this paper leverages subjective price expectations from the University of Michigan Survey of Consumers to test for exuberance without imposing a specific model of intrinsic housing values.
May 21, 2025
Working Paper
Global Macro-Financial Cycles and Spillovers
This paper develops a new dynamic factor model to jointly characterize global macroeconomic and financial cycles and the spillovers between them.
April 22, 2025
Working Paper
Tempting FAIT: Flexible Average Inflation Targeting and the Post-COVID U.S. Inflation Surge
In August 2020, the Federal Reserve adopted Flexible Average Inflation Targeting (FAIT), permitting inflation to temporarily exceed the 2% target. Using synthetic control methods, this paper estimates that FAIT raised headline CPI inflation by 1 percentage point and core CPI by 0.5 percentage points, relative to a no-FAIT-adoption counterfactual, with short-lived effects concentrated during the 2021 inflation surge.
April 09, 2025
Working Paper
Living Up to Expectations: The Effectiveness of Forward Guidance and Inflation Dynamics Post-Global Financial Crisis
This paper studies the effectiveness of forward guidance when central banks face private agents with heterogeneous expectations allowing for a degree of bounded rationality.
April 03, 2025
Working Paper
Trade Costs and Inflation Dynamics
Using bilateral trade flows from detailed global input-output data and a gravity framework, this paper estimates trade cost shocks and their effects on CPI inflation.
March 04, 2025
Working Paper
An Anatomy of U.S. Establishments’ Trade Linkages in Global Value Chains
Global value chains (GVC) are a pervasive feature of modern production, but they are hard to measure. Using U.S. Census microdata, this paper develops novel measures of the linkages between U.S. manufacturing establishments’ imports and exports. The paper documents three new GVC patterns.
December 27, 2024