Research
Work in Progress
The relationship between money growth and inflation: a theory
Endogenous Bank Risks and the Lending Channel of Monetary Policy
with David Rivero and Hugo Rodriguez Mendizabal
This paper develops a general equilibrium banking model where credit creation and payment flows endogenously link credit, liquidity, and solvency risks. Banks issue deposits at loan origination. As deposits circulate, reserve settlement creates liquidity exposure and repayment shortfalls generate credit and solvency risk. These risks are jointly determined by credit provision and bound balance sheet expansion at an internally determined profitability threshold rather than an external funding or capital limit. We present an application of the theory that provides a new look to the bank lending channel where monetary policy operates through the pricing of bank liabilities, compressing margins and curbing credit. Our quantitative results align with empirical observations, including comovement of policy rates with deposit spreads and net interest margins and a decline in deposit growth after tightening. The mechanism speaks to policy: calibrating liquidity and capital tools in isolation can blunt their effectiveness.
Migration, Culture, and Long-Run Development: Evidence from Brazil’s German Colonies
This paper examines the long-term impact of early settlers on economic prosperity. Specifically, this paper investigates the long-term economic impact of 19th-century German immigration to southern Brazil, focusing on how early human capital shocks shaped development in a largely undeveloped region. Exploiting spatial variation in proximity to historical German settlements, I find that municipalities closer to these colonies exhibit significantly higher current literacy rates and income levels. The empirical strategy combines a quasi-natural experiment with robustness checks, placebo tests, and a comparative analysis with Italian settlement areas to support causal interpretation. I show that literacy is a key mediating channel, and that historical proximity to German colonies is associated with structural shifts away from agriculture and toward human capital-intensive industries. These findings highlight the enduring influence of early skilled immigration on local development.
The Impact of Work Sponsor Visas on Earnings, Productivity and Sorting
with Cecilia Karmel
Published papers
Which Firms Get Credit? Evidence from Firm-level Data, Reserve Bank of Australia Bulletin, December 2018.
with Jonathan Hambur
Financial Stability Risks and Retailing, Reserve Bank of Australia Bulletin, September 2018.
with Timoth de Atholia