In this paper, we use a novel natural experiment and Norwegian tax data to quantify the causal impact of unemployment risk on individual savings. By comparing individuals who live in the same area but face different increases in risk, we show that a one-percentage-point increase in unemployment rates increases safe assets by 1.3%. Reas- suringly, this effect is driven by low-tenured workers, who face the highest increase in risk. Savings in risky financial assets remain unaffected, implying a decrease in the overall risky share of individual portfolios. We use two independent approaches, relying either on cross-sectional variation or time series variation, to quantify the importance of job loss risk in accounting for higher savings during recessions. Our results suggest that unemploy- ment risk can explain 60%–80% of the recession-induced increase in safe assets
Fjære-Lindkjenn, Jeanette; Aastveit, Knut Are, Karlman, Markus Johan, Kinnerud, Karin, Juelsrud, Ragnar Enger & Wold, Ella Getz (2024)
Hvordan virker utlånsforskriften? En oppsummering av forskningslitteraturen
Samfunnsøkonomen
I denne artikkelen forsøker vi å svare på om utlånsforskriften har virket etter hensikten og hvilke kostnader den påfører husholdningene. Forskningslitteraturen indikerer at boliglånsregulering bidrar til noe lavere gjelds- og boligprisvekst, men at det er mer usikkert om den reduserer husholdningenes sårbarhet for uforutsette hendelser som renteøkninger og arbeidsledighet. Utlånsforskriften påfører samtidig mange husholdninger kostnader ved at den begrenser muligheten for konsumglatting og kan gjøre det vanskeligere for unge å kjøpe sin første bolig. Reguleringen kan også forsterke viktigheten av formuende foreldre for muligheten til boligkjøp. Høy inflasjon og rente kan redusere behovet for forskriften og øke kostnadene.
Eggertsson, Gauti; Juelsrud, Ragnar Enger, Summers, Lawrence H. & Wold, Ella Getz (2023)
Negative Nominal Interest Rates and the Bank Lending Channel
We investigate the bank lending channel of negative nominal policy rates from an empirical and theoretical perspective. For the empirical results we rely on Swedish data, including daily banklevel lending rates. We find that retail household deposit rates are subject to a lower bound (DLB). Empirically, once the DLB is met, the pass-through to mortgage lending rates and credit volumes is substantially lower and bank equity values decline in response to further policy rate cuts. We construct a banking sector model and use our estimate of the pass-through of negative policy rates to lending rates as an identified moment to parameterize the model and assess the impact of negative policy rates in general equilibrium. Using the theoretical framework, we derive a sufficient statistic for when negative policy rates are expansionary and when they are not.
Eggertsson, Gauti; Robbins, Jacob & Wold, Ella Getz (2021)
Kaldor and Piketty's facts: The rise of monopoly power in the United States
The macroeconomic data of the last fifty years have overturned at least two of Kaldor’s famous stylized growth facts: constant interest rates, and a constant labor share. At the same time, the research of Piketty and others has introduced several new and surprising facts: an increase in the financial wealth-to-output ratio in the US, an increase in measured Tobin’s Q, and a divergence between the marginal and average returns on capital. In this paper, we argue that these trends can be explained by an increase in market power and pure profits in the US economy—that is, the emergence of a non-zero-rent economy—along with forces that have led to a persistent long-term decline in real interest rates. We make three parsimonious modifications to the standard neoclassical model to explain these trends. Using recent estimates of the increase in markups and the decrease in real interest rates, we show that our model can quantitatively match these new stylized macroeconomic facts.
Juelsrud, Ragnar Enger & Wold, Ella Getz (2020)
Risk-weighted capital requirements and portfolio rebalancing
