Working Papers

1. The Portfolio Choice Channel of Wealth Inequality
   with Mauricio Calani
   
   [ Paper | Abstract ]

   This paper studies how differences in portfolio choice across households help explain the highly unequal wealth distribution seen in the data. It has been well documented that participation rates are substantially smaller than the ones predicted in standard models of portfolio choice. Also, both participation rates and risky shares are highly increasing in wealth. However, both features are usually absent in workhorse models of wealth accumulation. We introduce portfolio choice and adjustment frictions into an otherwise standard model of household saving behavior. Calibrating it to U.S. household-level data, we show that the model is able to provide a better fit of the wealth distribution while being consistent with well-known facts of households’ portfolio choices. In particular, the model explains roughly half of the gap between top wealth shares predicted by traditional models of wealth accumulation (e.g. Aiyagari, 1994) and the data.
2. Causal Effect of Public Holidays on Economic Growth
   with Rodrigo Wagner
   
   [ Paper | Abstract ]

   This paper studies the aggregate effect of a marginal working day. It introduces a novel dataset of public holidays for over 200 countries since year 2000. As a source of exogenous variation, we exploit changes in working days due to public holidays falling on weekends. Yearly working days present a within-country range of 1.9 percent (approximately 5 days). Using this variation, we estimate an elasticity of output growth to transitory changes in legal working days of 0.17 robust across multiple specifications and heterogeneous across sectors, with larger effects on manufacturing and no significant impact on agriculture. We also find that holidays are associated to fewer work-related deaths and to increases in short-run happiness.

Publications

1. How Much Does Mobility Matter for Value-Added Tax Revenue? Cross-Country Evidence Around COVID-19
   with Rodrigo Wagner
   International Tax and Public Finance, 31(3), 841–855 (2024)
   [ Journal Version ]