Details about Carlo Favero

E-mail:
Homepage:	http://www.igier.unibocconi.it/favero
Workplace:	Dipartimento di Finanza (Department of Finance), Università Commerciale Luigi Bocconi (Bocconi University), (more information at EDIRC) Innocenzo Gasparini Institute for Economic Research (IGIER), Università Commerciale Luigi Bocconi (Bocconi University), (more information at EDIRC) Centre for Economic Policy Research (CEPR), (more information at EDIRC)

Access statistics for papers by Carlo Favero.

Last updated 2013-05-21. Update your information in the RePEc Author Service.

Short-id: pfa12

---

Jump to Journal Articles Books Edited books Chapters

Working Papers

2013

1. The output effect of fiscal consolidations
   Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University
   Also in NBER Working Papers, National Bureau of Economic Research, Inc (2012) View citations (2)
   Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University (2012) View citations (2)
   CEPR Discussion Papers, C.E.P.R. Discussion Papers (2012) View citations (2)

2012

2. Euro Area Money Demand and International Portfolio Allocation: A Contribution to Assessing Risks to Price Stability
   CEPR Discussion Papers, C.E.P.R. Discussion Papers
   Also in Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University (2012)
   Working Paper Series, European Central Bank (2008) View citations (5)
   See also Journal Article in Journal of International Money and Finance (2013)
3. Measuring the Impact of Longevity Risk on Pension Systems: The Case of Italy
   Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University
4. Modelling and Forecasting Yield Differentials in the euro area. A non-linear Global VAR model
   Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University

2011

5. Country Heterogeneity and the International Evidence on the Effects of Fiscal Policy
   CEPR Discussion Papers, C.E.P.R. Discussion Papers View citations (3)
   Also in Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University (2011) View citations (3)
   NBER Working Papers, National Bureau of Economic Research, Inc (2011) View citations (3)
   See also Journal Article in IMF Economic Review (2011)
6. Demographics and The Behaviour of Interest Rates
   Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University
7. Insider Trading, Traded Volume and Returns
   Working papers, Former Department of Economics and Public Finance "G. Prato", University of Torino View citations (3)
8. Progress in Medicine, Limits to Life and Forecasting Mortality
   Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University
9. Sovereign spreads in the Euro Area. Which prospects for a Eurobond?
   Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University View citations (5)
   Also in CEPR Discussion Papers, C.E.P.R. Discussion Papers (2011) View citations (7)

2010

10. A Spectral Estimation of Tempered Stable Stochastic Volatility Models and Option Pricing
    Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University View citations (1)
    See also Journal Article in Computational Statistics & Data Analysis (2012)
11. Demographic Trends, the Dividend-Price Ratio and the Predictability of Long-Run Stock Market Returns
    Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University View citations (1)
    Also in CEPR Discussion Papers, C.E.P.R. Discussion Papers (2010)
    See also Journal Article in Journal of Financial and Quantitative Analysis (2011)
12. Demographics and the Econometrics of the Term Structure of Stock Market Risk
    Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University View citations (1)
13. Reconciling VAR-based and Narrative Measures of the Tax-Multiplier
    Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University View citations (1)
    Also in CEPR Discussion Papers, C.E.P.R. Discussion Papers (2010) View citations (4)

2009

14. How Large Are the Effects of Tax Changes?
    CEPR Discussion Papers, C.E.P.R. Discussion Papers View citations (4)
    Also in Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University (2009) View citations (4)
    NBER Working Papers, National Bureau of Economic Research, Inc (2009) View citations (4)
15. Monetary Policy Inertia: More a Fiction than a fact?
    CEPR Discussion Papers, C.E.P.R. Discussion Papers View citations (3)
    See also Journal Article in Journal of Monetary Economics (2009)
16. On the Statistical Identification of DSGE Models
    CEPR Discussion Papers, C.E.P.R. Discussion Papers View citations (4)
    Also in Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University (2007) View citations (4)
    See also Journal Article in Journal of Econometrics (2009)

2008

17. Demographics and fluctuations in Dividend/Price
    Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University
18. How Does Liquidity Affect Government Bond Yields?
    CEPR Discussion Papers, C.E.P.R. Discussion Papers View citations (4)
    Also in CSEF Working Papers, Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy (2007) View citations (1)
    Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University (2007) View citations (3)
    See also Journal Article in Journal of Financial and Quantitative Analysis (2010)
19. Should the Euro Area be Run as a Closed Economy?
    Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University View citations (2)
    Also in CEPR Discussion Papers, C.E.P.R. Discussion Papers (2008) View citations (3)
    See also Journal Article in American Economic Review (2008)
20. The ECB and the bond market
    European Economy - Economic Papers, Directorate General Economic and Monetary Affairs (DG ECFIN), European Commission

2007

21. Debt and the Effects of Fiscal Policy
    CEPR Discussion Papers, C.E.P.R. Discussion Papers View citations (34)
    Also in Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University (2007) View citations (28)
    Working Papers, Federal Reserve Bank of Boston (2007) View citations (34)
    NBER Working Papers, National Bureau of Economic Research, Inc (2007) View citations (34)
22. Model Evaluation in Macroeconometrics: from early empirical macroeconomic models to DSGE models
    Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University View citations (2)
23. Term Structure Forecasting: No-Arbitrage Restrictions vs Large Information Set
    CEPR Discussion Papers, C.E.P.R. Discussion Papers View citations (7)
    Also in Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University (2007) View citations (7)
24. The Econometrics of Monetary Policy: an Overview
    Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University

2006

25. Fiscal Policy and the Term Structure: Evidence from the Case of Italy in the EMS and the EMU Periods
    Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University
    Also in CEPR Discussion Papers, C.E.P.R. Discussion Papers (2006) View citations (2)
26. The Performance of Italian Family Firms
    CEPR Discussion Papers, C.E.P.R. Discussion Papers View citations (4)

2005

27. Consumption, Wealth, the Elasticity of Intertemporal Substitution and Long-Run Stock Market Returns
    Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University View citations (1)
    Also in CEPR Discussion Papers, C.E.P.R. Discussion Papers (2005) View citations (4)
28. Fiscal Policy Rules and Regime (In)Stability: Evidence from the U.S
    Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University View citations (20)
29. Modelling and Forecasting Fiscal Variables for the Euro Area
    Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University View citations (8)
    Also in CEPR Discussion Papers, C.E.P.R. Discussion Papers (2005) View citations (14)
    See also Journal Article in Oxford Bulletin of Economics and Statistics (2005)
30. Monetary Policy in the Euro Area: Lessons from Five Years of ECB and Implications for Turkey
    CEPR Discussion Papers, C.E.P.R. Discussion Papers
31. Monetary policy in the Euro area: Lessons from 5 years of ECB and implications for Turkey
    Economics Working Papers, Department of Economics and Business, Universitat Pompeu Fabra
32. Parameter Instability, Model Uncertainty and the Choice of Monetary Policy
    CEPR Discussion Papers, C.E.P.R. Discussion Papers View citations (4)
    See also Journal Article in The B.E. Journal of Macroeconomics (2005)
33. The Predictive Power of the Yield Spread: Further Evidence and A Structural Interpretation
    CEPR Discussion Papers, C.E.P.R. Discussion Papers View citations (12)
    Also in Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University (2005) View citations (5)
34. Valutation, Liquidity and Risk in Government Bond Markets
    Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University View citations (6)

2004

35. Financial Factors, Macroeconomic Information and the Expectations Theory of the Term Structure of Interest Rates
    Computing in Economics and Finance 2004, Society for Computational Economics View citations (3)
    Also in Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University (2004) View citations (6)
    CEPR Discussion Papers, C.E.P.R. Discussion Papers (2004) View citations (9)
    See also Journal Article in Journal of Econometrics (2006)
36. Forecasting Italian inflation with large datasets and many models
    Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University
37. Inflation Targeting and Debt: Lessons from Brazil
    NBER Working Papers, National Bureau of Economic Research, Inc View citations (28)
    Also in CEPR Discussion Papers, C.E.P.R. Discussion Papers (2004) View citations (33)

2003

38. Model Uncertainty, Thick Modelling and the Predictability of Stock Returns
    CEPR Discussion Papers, C.E.P.R. Discussion Papers View citations (2)
    Also in Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University View citations (7)
39. Monetary-Fiscal Mix and Inflation Performance: Evidence from the U.S
    Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University View citations (10)
    Also in CEPR Discussion Papers, C.E.P.R. Discussion Papers (2003) View citations (19)

2002

40. How do European Monetary and Fiscal Authorities Behave?
    CEPR Discussion Papers, C.E.P.R. Discussion Papers View citations (51)
    Also in Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University View citations (1)

2001

41. Does Macroeconomics Help Us To Understand the Term Structure of Interest Rates?
    CEPR Discussion Papers, C.E.P.R. Discussion Papers View citations (4)
42. Large Datasets, Small Models and Monetary Policy in Europe
    CEPR Discussion Papers, C.E.P.R. Discussion Papers View citations (19)
    Also in Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University
43. Uncertainty on Monetary Policy and the Expectational Model of the Term Structure of Interest Rates
    CEPR Discussion Papers, C.E.P.R. Discussion Papers View citations (1)
    Also in Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University View citations (2)
    See also Journal Article in Economics Letters (2001)

2000

44. Looking for Contagion: Evidence from the ERM
    NBER Working Papers, National Bureau of Economic Research, Inc View citations (13)
45. Looking for Contagion: the Evidence from the ERM
    CEPR Discussion Papers, C.E.P.R. Discussion Papers View citations (10)
46. Measuring Co-Movements Between US and European Stock Markets
    CEPR Discussion Papers, C.E.P.R. Discussion Papers View citations (4)
    Also in Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University

1999

47. Measuring Monetary Policy in Open Economies
    CEPR Discussion Papers, C.E.P.R. Discussion Papers View citations (4)
    Also in Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University View citations (2)
48. Modelling and Identifying Central Banks' Preferences
    CEPR Discussion Papers, C.E.P.R. Discussion Papers View citations (11)
    Also in Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University View citations (6)
49. The Transmission Mechanism of Monetary Policy in Europe: Evidence from Banks' Balance Sheets
    CEPR Discussion Papers, C.E.P.R. Discussion Papers View citations (31)
    Also in NBER Working Papers, National Bureau of Economic Research, Inc (1999) View citations (50)

1998

50. A Red Letter Day?
    CEPR Discussion Papers, C.E.P.R. Discussion Papers View citations (23)
51. High Yields: The Spread on German Interest Rates
    NBER Working Papers, National Bureau of Economic Research, Inc
    Also in Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University
    CEPR Discussion Papers, C.E.P.R. Discussion Papers (1996) View citations (8)
    See also Journal Article in Economic Journal (1997)
52. The Immediate Challenges for the European Central Bank
    NBER Working Papers, National Bureau of Economic Research, Inc View citations (109)

1997

53. Extracting Information from Asset Prices: The Methodology of EMU Calculators
    CEPR Discussion Papers, C.E.P.R. Discussion Papers View citations (7)
    Also in Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University View citations (5)
    See also Journal Article in European Economic Review (2000)
54. Measuring Monetary Policy with VAR Models: An Evaluation
    CEPR Discussion Papers, C.E.P.R. Discussion Papers View citations (7)
    Also in Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University View citations (11)
    See also Journal Article in European Economic Review (1998)

1996

55. Monetary Policy, Forward Rates and Long Rates: Does Germany Differ from the United States?
    CEPR Discussion Papers, C.E.P.R. Discussion Papers View citations (5)

1993

56. Ottimizzazione intertemporale e metodi econometrici in economia
    Working Papers, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali
57. Output, interest rates and the monetary trasmission mechanism: some empirical evidence for Italy
    Working Papers, Universita' Politecnica delle Marche (I), Dipartimento di Scienze Economiche e Sociali

1992

58. Oil Investment in the North Sea
    Cambridge Working Papers in Economics, Faculty of Economics, University of Cambridge
    See also Journal Article in Economic Modelling (1994)
59. Uncertainty and Irreversible Investment: An Empirical Analysis of Development of Oilfields on the UKCS
    Cambridge Working Papers in Economics, Faculty of Economics, University of Cambridge View citations (4)

1990

60. TESTING THE LUCAS CRITIQUE: A REVIEW
    Economics Series Working Papers, University of Oxford, Department of Economics View citations (51)
61. THE ROLE OF TAXATION IN AN INTERTEMPORAL OPTIMIZATION MODEL OF EXPLORATION AND PRODUCTION OF OIL IN THE NORTH SEA: AN EVALUATION
    Working Papers, California Los Angeles - Applied Econometrics

1989

62. THE LUCAS' CRITIQUE, FEEDBACK AND FEEDFORWARD MECHANISMS AND THE CONSUMTION FUNCTION: AN EMPIRICAL STUDY
    Economics Series Working Papers, University of Oxford, Department of Economics

Undated

63. Does Macroeconomics Help Understand the Term Structure of Interest Rates?
    Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University View citations (2)
64. Information from financial markets and VAR measures of monetary policy
    Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University View citations (6)
    See also Journal Article in European Economic Review (1999)
65. Macroeconomic stability and the preferences of the Fed. A formal analysis, 1961-98
    Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University
    See also Journal Article in Journal of Money, Credit and Banking (2003)
66. Parameters´ Instability, Model Uncertainty and Optimal Monetary Policy
    Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University View citations (4)
67. Principal components at work: The empirical analysis of monetary policy with large datasets
    Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University View citations (12)
    See also Journal Article in Journal of Applied Econometrics (2005)
68. Recursive `thick´ modeling of excess returns and portfolio allocation
    Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University View citations (8)
69. Why are Brazil´s Interest Rates so High?
    Working Papers, IGIER (Innocenzo Gasparini Institute for Economic Research), Bocconi University View citations (18)

Journal Articles

2013

1. Euro area money demand and international portfolio allocation: A contribution to assessing risks to price stability
   Journal of International Money and Finance, 2013, 32, (C), 377-404
   See also Working Paper (2012)

2012

2. A spectral estimation of tempered stable stochastic volatility models and option pricing
   Computational Statistics & Data Analysis, 2012, 56, (11), 3645-3658
   See also Working Paper (2010)
3. Measuring Tax Multipliers: The Narrative Method in Fiscal VARs
   American Economic Journal: Economic Policy, 2012, 4, (2), 69-94 View citations (3)
4. Sovereign spreads in the eurozone: which prospects for a Eurobond?
   Economic Policy, 2012, 27, (70), 231-273 View citations (1)
5. Term Structure Forecasting: No‐Arbitrage Restrictions versus Large Information Set
   Journal of Forecasting, 2012, 31, (2), 124-156

2011

6. Comment
   NBER International Seminar on Macroeconomics, 2011, 7, (1), 31 - 36
7. Country Heterogeneity and the International Evidence on the Effects of Fiscal Policy
   IMF Economic Review, 2011, 59, (4), 652-682 View citations (3)
   See also Working Paper (2011)
8. Demographic Trends, the Dividend-Price Ratio, and the Predictability of Long-Run Stock Market Returns
   Journal of Financial and Quantitative Analysis, 2011, 46, (05), 1493-1520
   See also Working Paper (2010)
9. Demographics and US Stock Market Fluctuations*
   CESifo Economic Studies, 2011, 57, (1), 25-43

2010

10. How Does Liquidity Affect Government Bond Yields?
    Journal of Financial and Quantitative Analysis, 2010, 45, (01), 107-134 View citations (9)
    See also Working Paper (2008)

2009

11. Monetary policy inertia: More a fiction than a fact?
    Journal of Monetary Economics, 2009, 56, (6), 900-906 View citations (3)
    See also Working Paper (2009)
12. On the statistical identification of DSGE models
    Journal of Econometrics, 2009, 150, (1), 99-115 View citations (4)
    See also Working Paper (2009)

2008

13. Should the Euro Area Be Run as a Closed Economy?
    American Economic Review, 2008, 98, (2), 138-45 View citations (3)
    See also Working Paper (2008)

2006

14. Financial factors, macroeconomic information and the Expectations Theory of the term structure of interest rates
    Journal of Econometrics, 2006, 131, (1-2), 339-358 View citations (10)
    See also Working Paper (2004)
15. Taylor rules and the term structure
    Journal of Monetary Economics, 2006, 53, (7), 1377-1393 View citations (13)
16. The econometrics of macroeconomics, finance, and the interface
    Journal of Econometrics, 2006, 131, (1-2), 1-2

2005

17. Explaining co-movements between stock markets: The case of US and Germany
    Journal of International Money and Finance, 2005, 24, (8), 1299-1316 View citations (7)
18. Ignazio Angeloni, Anil Kashyap and Benoit Mojon, Monetary policy transmission in the euro area, Cambridge University Press (2003)
    Journal of International Economics, 2005, 67, (2), 524-528
19. Modelling and Forecasting Fiscal Variables for the Euro Area
    Oxford Bulletin of Economics and Statistics, 2005, 67, (s1), 755-783 View citations (13)
    See also Working Paper (2005)
20. Parameter Instability, Model Uncertainty and the Choice of Monetary Policy
    The B.E. Journal of Macroeconomics, 2005, topics.5, (1), 4 View citations (6)
    See also Working Paper (2005)
21. Principal components at work: the empirical analysis of monetary policy with large data sets
    Journal of Applied Econometrics, 2005, 20, (5), 603-620 View citations (38)
    See also Working Paper

2004

22. Comments on "Fiscal and monetary policy interactions: Empirical evidence on optimal policy using a structural new-Keynesian model"
    Journal of Macroeconomics, 2004, 26, (2), 281-285 View citations (1)

2003

23. APPLIED MACROECONOMETRICS Carlo A. Favero Oxford University Press, 2001
    Macroeconomic Dynamics, 2003, 7, (02), 313-315 View citations (45)
24. Macroeconomic Stability and the Preferences of the Fed: A Formal Analysis, 1961-98
    Journal of Money, Credit and Banking, 2003, 35, (4), 545-56 View citations (44)
    See also Working Paper
25. Yield spreads on EMU government bonds
    Economic Policy, 2003, 18, (37), 503-532 View citations (77)

2002

26. Is the international propagation of financial shocks non-linear?: Evidence from the ERM
    Journal of International Economics, 2002, 57, (1), 231-246 View citations (50)

2001

27. Uncertainty on monetary policy and the expectations model of the term structure of interest rates
    Economics Letters, 2001, 71, (3), 369-375 View citations (5)
    See also Working Paper (2001)

2000

28. Extracting information from asset prices: The methodology of EMU calculators
    European Economic Review, 2000, 44, (9), 1607-1632 View citations (7)
    See also Working Paper (1997)

1999

29. Financial markets' assessments of EMU: A comment
    Carnegie-Rochester Conference Series on Public Policy, 1999, 51, (1), 271-280 View citations (1)
30. Information from financial markets and VAR measures of monetary policy
    European Economic Review, 1999, 43, (4-6), 825-837 View citations (17)
    See also Working Paper

1998

31. Immediate challenges for the European Central Bank
    Economic Policy, 1998, 13, (26), 15-64 View citations (122)
32. Measuring monetary policy with VAR models: An evaluation
    European Economic Review, 1998, 42, (6), 1069-1112 View citations (68)
    See also Working Paper (1997)

1997

33. High Yields: The Spread on German Interest Rates
    Economic Journal, 1997, 107, (443), 956-85 View citations (39)
    See also Working Paper (1998)

1994

34. A Duration Model of Irreversible Oil Investment: Theory and Empirical Evidence
    Journal of Applied Econometrics, 1994, 9, (S), S95-112 View citations (13)
35. Oil investment in the North Sea
    Economic Modelling, 1994, 11, (3), 308-329 View citations (11)
    See also Working Paper (1992)

1993

36. Error Correction and Forward Looking Models for UK Consumers' Expenditure
    Oxford Bulletin of Economics and Statistics, 1993, 55, (4), 453-72 View citations (1)

1992

37. Money demand instability, expectations and policy regimes: A note on the case of Italy: 1964-1986
    Journal of Banking & Finance, 1992, 16, (2), 331-349 View citations (2)
38. Taxation and the Optimization of Oil Exploration and Production: The UK Continental Shelf
    Oxford Economic Papers, 1992, 44, (2), 187-208 View citations (2)

Books

2001

1. Applied Macroeconometrics
   OUP Catalogue, Oxford University Press View citations (45)

Edited books

2007

1. Monetary Policy, Fiscal Policies and Labour Markets
   Cambridge Books, Cambridge University Press

2004

2. Monetary Policy, Fiscal Policies and Labour Markets
   Cambridge Books, Cambridge University Press View citations (2)

Chapters

2010

1. Comment on "Euro Membership as a U.K. Monetary Policy Option: Results from a Structural Model"
   A chapter in Europe and the Euro, 2010, pp 440-445
2. Comment on "Fiscal Policy and Interest Rates: The Role of Sovereign Default Risk"
   A chapter in NBER International Seminar on Macroeconomics 2010, 2010, pp 31-35