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Can business play a role in building resilience among vulnerable communities? Can (marketing) employment contribute to resilience – and if so, how? These are increasingly important and relevant questions in our current world as the recent COVID-19 pandemic showed many households to be just one shock away from falling into poverty. Consequently, understanding how resilience, the ability to cope both psychologically and economically with adversity, can be built has become a top priority for many policymakers and practitioners. This paper explores a marketing solution to building resilience. In this paper, we seek to answer the following question: “Can sales employment help people build resilience and enable them to cope with adversity?” We offer a mechanism through which sales improves resilience: by facilitating opportunities to connect. We show that by enabling opportunities to connect with a wide set of individuals, sales employment can build resilience. We differentiate between types of connections and show that different connections can lead to different forms of resilience. We present experimental evidence from a randomized controlled trial involving saleswomen in rural India. With our partner organization, we recruited, trained, and randomly assigned 1,048 women to either treatment, placebo, or control condition. We exogenously assign individuals to an employment position that facilitates opportunities to connect and measure the impact on resilience. In doing so, not only do we vary opportunities to connections, but we also provide a plausible mechanism of why they have more connections than others: certain jobs – in our case sales employment. To the best of our knowledge, there is no empirical evidence showing the impact of (changing) connections on resilience when facing adversity. In doing so, we are the first to randomly assign participants to different employment forms and causally estimate the impact of employment on personal outcomes, such as resilience. Our results show that those engaged in sales employment are more resilient than those in placebo employment or no-employment conditions. In fact, we find that sales employment significantly improves one’s ability to be economically resilient when facing adversity by increasing: i) the likelihood of being aware of external sources of help and ii) the ability to take-up external sources of help. Second, our results show that engagement in sales is associated with having a wider set of connections. This effect is largely driven by increased connections with local government representatives and local community leaders. We find a strong association between the width of connections and economic and psychological resilience. Last, we examine heterogeneous effects and find that those from lower caste benefit most from engaging in sales employment in terms of building resilience compared. To the best of our knowledge, no one has looked at the impact of employment on resilience – we show that marketing employment holds the power to improve resilience when facing adversity.

This thesis is a contribution to macroeconomics and macro-finance research. It focuses on two areas, the interactions between debt markets and the macroeconomy, in the first two chapters, and consumption heterogeneity’s role in the transmission of shocks, in the third. The first chapter is my job market paper, “Monetary Policy and the Maturity Structure of Public Debt”. It studies the mediating impact of the maturity structure of public debt in the transmission of monetary policy shocks to economic activity. A longer debt maturity attenuates greatly the effect of monetary policy: going from the average historical duration of US debt to very short term debt doubles the impact of a rise of the policy rate on output. A similar result holds in UK data. There is no differential effect on inflation. I show that these effects can be traced back to a quantitatively important financing channel. A model featuring an interaction between an empirically estimated primary market friction and a standard financial accelerator is able to account for these facts. The second chapter of the thesis is “The Fiscal Consequences of Missing an Inflation Target”. This is a joint work with Helene Rey. We show, in Euro Area countries and in the US, the effect of the reliability of central banks’ monetary policy on public finances. When a credible central bank misses its inflation target, this has large fiscal consequences for the fiscal authority. These misses are quantitative sizable in the past low inflation decade, especially for countries with a high level and a high maturity of public debt. We link our results to the optimum currency area literature as the monetary-fiscal nexus is key to the functioning of the Euro Area: the ECB sets monetary policy for sovereigns with heterogeneous debt profiles. The third chapter of my thesis, “LESS is MORE: Consumer Spending and the Size of Economic Stimulus Payments”, is a joint work with Paolo Surico. We study the consumption response to unexpected transitory income gains of different size, using hypothetical survey questions. Affluent households exhibit a higher Marginal Propensity to Consume (MPC) out of large gains while families with low cash-on-hand display a higher MPC out of small gains. The spending of higher earners is consistent with the predictions of a model with non-homothetic preferences on consumption, while spending of low-income families can be accounted for by borrowing constraints. Our results suggest that, for a given level of public spending, a fiscal transfer of smaller size paid to a larger group of low-income households stimulates aggregate consumption more than a larger transfer paid to a smaller group.