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A common assumption of in literature regarding unemployment insurance (UI) take-up is unemployed individuals will claim UI benefits immediately after job loss. Using SIPP 2008 panel, I find that this assumption about immediate unemployment insurance take-up can not be supported in the data. I constructed a revised McCall search model to provide a mechanism to explain the delay of UI take-up found in the data. This dissertation contains three chapters. In Chapter 1, I provide evidence that UI application delay is significant. Many people delay at least one week -- 87\% of unemployed individuals delay at least one week, 37\% delay at least 4 weeks and 27\% individuals delay at least 12 weeks. The average delay is large -- unemployed individuals on average have 12.99 weeks of delay before claiming UI benefits after job loss. I also analyze factors that correlate with application delay. I find a lower age, being disabled, being female, facing good economic conditions and fewer experienced number of job separations make delay more likely and increase length of delay. In Chapter 2 , I provide a job search and separation model to explain the findings from the data in Chapter 1. I find that the application costs are large compared to benefits received. Counterfactual analysis show that reducing hassle of aplying for UI can have large impacts on delay of application. In Chapter 3 , I extend the methodology to study the effect of availability of other welfare programs such as Supplemental Security Income (SSI) on the application delay of UI for people who have reported disability. I find that the availability of other welfare programs such as SSI is a contributing factor that make delay more likely and longer for people with disability.

In this dissertation I present three chapters all related by their focus on issues of money and finance and the methodological treatment, the New Monetarist methodology, each considering different aspects of the international monetary-financial system. Williamson and Wright (2010) describe the New Monetarist methodology in detail, including enumerating several key principles, which put emphasis on microfoundations, especially of the frictions in the exchange process and financial intermediation arising from the environment, which are essential to analyses of macro and monetary economics. The first chapter is entitled ``Optimal Monetary Policy and the Welfare Cost of Inflation of a Currency Union.'' It seeks to answer the question: How do retail trade frictions interact with immigration choices, and how does this interaction affect monetary policy in a currency union? This chapter studies the welfare cost of inflation and optimal monetary policy of a currency union between two countries using a search-theoretic framework with endogenous composition of buyers and sellers. The model includes three features of a currency union that are key to welfare and policy analysis: heterogeneous market structure, imperfect market integration, and immigration policy. The model yields optimal monetary policy that deviates from the Friedman rule, with the magnitude of inflation rate and welfare cost determined by different policy regimes. The Friedman rule is suboptimal, because a matching congestion externality in the labor market arises from the endogenous composition of buyers and sellers. Higher labor mobility reduces the cost of inflation by alleviating congestion, regardless of buyers' bargaining power. Market integration may also reduce congestion, lowering the cost of inflation, but only when sellers are relatively scarce. The second chapter is entitled ``Liquidity, Collective Moral Hazard, and Government Bailouts''. It tries to answer the question: How does financial intermediaries risk taking respond to monetary/fiscal policy including bailout policy? This chapter develops a general equilibrium model of assets market integrating a theory of liquidity risk in a New Monetarist framework. Collective moral hazard arises from the interaction between banks' maturity transformation and government intervention. With the anticipation and implementation of government bailouts during a crisis, collective moral hazard creates current and deferred social costs. However, under the ``correct" monetary policy, the costs are justified by the improvement of liquidity condition as a result of higher provision of public and private liquidity. The third chapter is entitled ``On Cross-Border Payments and the Industrial Organization of Correspondent Banking.'' It tries to answer the question: How does an understanding of the market structure of international banking affect recent suggestions for the improvement of cross-border payments? Despite advances in domestic payments arrangements in recent times, cross-border payments remain expensive and slow. This paper builds a model of bank-intermediated cross-border payments, identifying market power inherent to correspondent banking relationships as the key friction reducing efficiency. After developing a simple model of correspondent banking, we consider two policy experiments: the introduction by one country of an internationally held central bank digital currency (CBDC), and development of an internationally interoperable settlement system. Both policies can at least attenuate the inefficiencies in cross-border payments, but neither is automatically a complete solution nor are they without difficulties. For an international CBDC, we identify a political economy barrier: banks of the country potentially introducing the CBDC disproportionately suffer losses while benefits tend to accrue to foreign depositors, so a central bank concerned with its domestic banks' profitability may be unlikely to take such an action. Interoperability does not face the same barrier, as benefits accrue more symmetrically, but we argue that technical and other issues inherent to interoperability may be difficult to overcome.

We show that cyclical variation in entry wages is driven by occupation mobility. To this end, we use Portuguese administrative data from 1986-2019 that accurately identifies occupation transitions between and within firms. We find that wages of new hires that remain in the same occupation are no more cyclical than those of stayers. By contrast, wages of workers switching occupation across and within firms are highly cyclical. Furthermore, we show that cyclicality increases, the more distinct the previous and current occupations are in terms of the required skills. Our results suggest that the standard framework in the literature conflates wage flexibility of new hires with cyclical changes in match quality associated with the worker’s occupation.

In this dissertation I develop three essays on dynamic conditional score (DCS) models for univariate and multivariate models. In the first essay, I focus on a DCS model with a short memory process with changes in regimes for volatility. I also study volatility dynamics in my second essay using score-based copula models with time-varying dependencies with two components. For my last essay, I propose a score-driven multivariate model with factors for the location or mean of a set of macroeconometric variables. All my essays deal with episodes of atypical observations such as the global financial crisis and the recent pandemic.

This dissertation has three chapters. The first one examines the causes of falling labour share in OECD and non-OECD countries since the 1980s. It finds that export and volatility are key drivers in OECD, but in the non-OECD, major forces are financial openness and investment’s relative price. The second chapter develops a model of currency substitution to explain the rising dollarisation in Cambodia. The last one develops and estimates a small open economy real-business cycle model to study the dynamics of Cambodian current account by including net unilateral transfers and net foreign direct investment as additional sources of macroeconomic fluctuations.

This dissertation consists of three independent chapters at the intersection of macroeconomics and labor economics. The first chapter studies the job-search trade-offs between full-time employment, part-time employment, and multiple job holdings. The second chapter explores the macroeconomic relationship between property crime and output in a dynamic stochastic general equilibrium framework. The third chapter studies the causal effect of property crime on output. The first chapter develops a search-matching model of the labor market with part-time employment and multiple job holdings. The model is calibrated to data from the CPS between 2001 and 2004. Workers are able to choose their search intensity and are allowed to hold two jobs while firms can choose what type of worker to recruit. When compared to the canonical Diamond-Mortensen-Pissarides model, this model performs quite well while capturing some empirical regularities. First, the model generates recruiting and vacancy posting rates that move in opposite directions. Second, part-time employment is up to 10 times more responsive than full-time employment. Third, the model suggests that multiple job holding rates are more flexible than observed in the data with the rate changing by as much as 4 percentage points compared to 0.1 percentage points in the data. Finally, the full model is able to capture compositional changes during recessions with the full-time rate declining and the part-time rate increasing. It also produces an empirically consistent increase in the unemployment rate as well as a decrease in output. The DMP model is more muted than in the data for both. The second chapter explores how property crime can affect static and dynamic general equilibrium behavior of households and firms. I calibrate a model with a representative firm and heterogeneous households where households have the choice to commit property crime. In contrast to previous literature, I treat crime as a transfer rather than home production. This creates a feedback loop wherein negative productivity shocks increase property crime which further depresses legitimate work and capital accumulation. These responses by households are particularly important when thinking about the effect of property crime on the economy. Household and firm losses account for 24% of compensating variation (CV) and 37% of lost production. This suggests that behavioral responses are quite important when calculating the cost of property crime. Finally, on the margin, decreasing property crime by 1% increases social welfare by 0.19%, but the effect is diminishing suggesting that reducing crime entirely may not be optimal from a policymakers perspective. The third chapter estimates the causal effect of property crime on real personal income per capita. Running system GMM on an unbalanced panel of MSA-year pairs suggests that property crime reduces real personal income per capita by a highly statistically significant 13.3%. This implies that the average person loses $4,869 (2009 dollars) per year with real annual personal income per capita totaling $36,615. The effect is driven primarily by larceny-theft and burglary with highly statistically significant coefficients of -0.179 and -0.110 respectively. Estimates for the effect of robbery are unstable, and the effect of motor vehicle theft is statistically significant, but smaller with a coefficient of -0.060.

We propose a new method for computing equilibria in heterogeneous-agent models with aggregate uncertainty. The idea relies on an assumption that linearization offers a good approximation; we share this assumption with existing linearization methods. However, unlike those methods, the approach here does not rely on direct derivation of first-order Taylor terms. It also does not use recursive methods, whereby aggregates and prices would be expressed as linear functions of the state, usually a very high-dimensional object (such as the wealth distribution). Rather, we rely merely on solving nonlinearly for a deterministic transition path: we study the equilibrium response to a single, small “MIT shock” carefully. We then regard this impulse response path as a numerical derivative in sequence space and hence provide our linearized solution directly using this path. The method can easily be extended to the case of many shocks and computation time rises linearly in the number of shocks. We also propose a set of checks on whether linearization is a good approximation. We assert that our method is the simplest and most transparent linearization technique among currently known methods. The key numerical tool required to implement it is value-function iteration, using a very limited set of state variables. This article is part of a Special Issue entitled “Fiscal and Monetary Policies”.