Libros

Resumen 

We consider a contractual relationship between an uninformed principal and an informed agent. The agent observes a multi-dimensional piece of private information which affects the mapping from actions to both players’ payoffs. Conditional on the information, the two parties’ preferences are not perfectly aligned. The agent sends a message to the principal, who then chooses multiple actions. We ask what outcomes the principal can achieve if she has limited commitment. In particular, we allow precisely one dimension in which the principal is able to commit to an action as a function of the agent’s message. In all other dimensions, the principal must take an action that is optimal given what she has learned. For example, an employer may be able to commit to a wage profile but unable to commit to other conditions of the job. We show that there is always a mechanism that induces full revelation of the information about the non-commitment actions. Furthermore, as the principal and the agent’s preferences become more and more divergent in the dimension of commitment, the principal’s payoff approaches that in which she has full information pertaining to all the dimensions in which she lacks commitment power. Our results imply that incompleteness of contracts may be irrelevant for payoffs and information revelation as long as there is some contractable outcome in which there is large conflict.

Resumen

What would happen if we selected only the best workers from a specific economic sector, make them work together for some months, and then observed their performance once they are back to their original firms? Would these high-skill workers benefit from working closely with other equally talented individuals? In this paper we test this idea focusing on basketball professional athletes. We study whether NBA players who go to the summer Olympic Games increase their performance playing for their teams in the following seasons. Using advanced statistics, which capture the contribution of the player to the team’s success, and the peculiar selection process of the U.S. national team, we find that Olympic players increase their performances compared to controls. We also find evidence that less experienced players are those who benefited the most form going to the Olympics. Finally, we do not find significant effects based on skill composition.

Resumen 

We study the different transmission of income shocks into consumption goods of different durability. We show that binding borrowing constraints lead to a substitution between goods upon arrival of an unexpected income change. The sign of this substitution depends critically on the persistence of the shock, whereas its size depends on the durability of goods and on their role as collateral for borrowing. An important consequence is that the response of nondurable consumption to income shocks is an imperfect measure of household insurance against labor market risk. We use a life-cycle model with labor market uncertainty and incomplete markets to quantify the actual amount of insurance implied by the observed transmission of income shocks to nondurable consumption. We find that young households have substantially less insurance against transitory shocks and more insurance against permanent shocks than implied by the transmission of the shocks into nondurable consumption expenditure.

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Resumen 

Given that financial protection in health is one of the objectives of the recent health system reforms in many developing countries, understanding clearly the mechanisms that lie behind the financial vulnerability associated with health shocks is key for the success of past and forthcoming reforms. Using Mexican longitudinal data, I study the effect of breadwinners’ health shocks on household consumption, measuring health shocks through changes in the capacity to perform Activities of Daily Living. I find that health shocks to households’ breadwinners are associated with significant long-lasting decreases in non-medical per capita consumption, but health shocks to other household members have no such effects. When consumption depends on labor income, the economic cost associated with a health shock may lie less with direct out of-pocket medical expenditures than with the diminished capacity to work. Therefore, providing health insurance to the previously uninsured sector of the population could potentially increase social welfare because of its consumption smoothing properties, although it would not necessarily provide full consumption insurance against health shocks. To illustrate this, I use a standardized expected utility model to compare the value of the risk of loss earnings due to health shocks, in my sample, relative to that of health expenditures. I then compute the risk premia households would be willing to pay to reduce, either partially or entirely, households’ risk exposure to any health shock.

Resumen 

This paper identifies anticipated (news) and unanticipated (surprise) shocks to the U.S. Fed Funds rate using Fed Funds Futures contracts, and assesses their propagation to emerging economies. Anticipated shocks are identified as the expected change in the Fed Funds rate orthogonal to expected U.S. business cycles conditions while unanticipated shocks are the one-step ahead forecast error. Anticipation accounts for 80% of quarterly Fed Funds fluctuations and explains 45% of the narrative series of monetary policy shocks. To identify the effects of both shocks, I estimate a Panel VAR using a sample of emerging economies. An anticipated (unanticipated) 25 basis points contractionary U.S. interest rate induces a fall of 0.5% in GDP one quarter before (after) the shock materializes. This effect is coupled with a depreciation of the exchange rate, an increase in sovereign spreads, and a decline in cross border bank flows. Results highlight the crucial role of anticipation, ignored by previous studies, to understand the propagation of U.S. interest rate shocks to emerging economies.