About the Researcher(s)/Author(s)

Mark Gertler, a professor of economics at New York University, codirects the Economic Fluctuations and Growth Program. This report draws on extensive input from Roland Bénabou, Oded Galor, Erik Hurst, Greg Kaplan, Gianluca Violante, and Fabrizio Zilibotti.

Pete Klenow, a professor of economics at Stanford University, codirects the Economic Fluctuations and Growth Program. This report draws on extensive input from Roland Bénabou, Oded Galor, Erik Hurst, Greg Kaplan, Gianluca Violante, and Fabrizio Zilibotti.

Footnotes

1. M. Gertler and S. Gilchrist, "What Happened: Financial Factors in the Great Recession," NBER Working Paper No. 24746, June 2019, provide a time line of the crisis that high-lights these two channels.  Go to ⤴︎
2. O. Jordà, M. Schularik, and A. Taylor, "Macrofinancial History and the New Business Cycle Facts," NBER Working Paper No. 22743, October 2016 Go to ⤴︎
3. A. Krishnamurthy and T. Muir, "How Credit Cycles Across a Financial Crisis," NBER Working Paper No. 23850, September 2017. Go to ⤴︎
4. A. Mian and A. Sufi, "House Prices, Home Equity-Based Borrowing, and the U.S. Household Leverage Crisis," NBER Working Paper No. 15283, August 2009, and A. Mian and A. Sufi, "What Explains High Unemployment? The Aggregate Demand Channel," NBER Working Paper No. 17830, February 2012. Go to ⤴︎
5. A voluminous empirical literature has followed that essentially confirms Mian and Sufi's findings, including, for example, G. K. Mitman and G. Violante, "Non-durable Consumption and Housing Net Worth in the Great Recession: Evidence from Easily Accessible Data," NBER Working Paper No. 22232, May 2016; and C. Jones, V. Midrigan, and T. Philippon, "Household Leverage and the Recession," NBER Working Paper No. 16965, April 2011. Go to ⤴︎
6. Examples of models with this feature include V. Guerrieri and G. Lorenzoni, "Credit Crises, Precautionary Savings, and the Liquidity Trap," NBER Working Paper No. 17583, November 2011; G. Kaplan, K. Mitman, and G. Violante, "The Housing Boom and Bust: Model Meets Evidence," NBER Working Paper No. 23694, August 2017; D. Berger, V. Guerrieri, G. Lorenzoni, and J. Vavra, "House Prices and Consumer Spending," NBER Working Paper No. 21667, October 2015; and A. Justiniano, G. Primiceri, and A. Tambalotti, "Credit Supply and the Housing Boom," NBER Working Paper No. 20874, January 2015 Go to ⤴︎
7. M. Gertler, N. Kiyotaki, and A. Prestipino, "A Macroeconomic Model with Financial Panics," NBER Working Paper No. 24126, December 2017, provides a timeline of the rise and fall of the shadow banking sector. Go to ⤴︎
8. S. Gilchrist and E. Zakrajšek, "Credit Spreads and Business Cycle Fluctuations," NBER Working Paper No. 17021, May 2011. Go to ⤴︎
9. G. Chodorow-Reich, "The Employment Effects of Credit Market Disruptions, Firm-level Evidence from the 2008-2009 Financial Crisis," Quarterly Journal of Economics, 129(1), 2013, pp. 1–59. For related evidence on how the disruption of intermediation financial affected nonfinancial firms, see G. Chodorow-Reich and A. Falato, "The Loan Covenant Channel: How Bank Health Transmits to the Real Economy," NBER Working Paper No. 23879, September 2017; S. Gilchrist, R. Schoenle, J. Sim, and E. Zakrajšek, "Inflation Dynamics During the Financial Crisis," NBER Working Paper No. 22827, November 2016; B. Chen, S. Hanson, and J. Stein, "The Decline of Big-Bank Lending to Small Business: Dynamic Impacts on Local Credit and Labor Markets," NBER Working Paper No. 23843, September 2017. E. Benmelech, R. Meisenzahl, and R. Ramcharan, "The Real Effects of Liquidity During the Financial Crisis: Evidence from Automobiles," NBER Working Paper No. 22148, April 2016, present evidence on how such disruptions affected household auto demand. Go to ⤴︎
10. Z. He and A. Krishnamurthy, "A Macroeconomic Framework for Quantifying Systemic Risk," NBER Working Paper No. 19885, February 2014, present a model in this tradition.     Go to ⤴︎
11.  A. Krishnamurthy, S. Nagel, and D. Orlov, "Sizing Up Repo," NBER Working Paper No. 17768, January 2012. Go to ⤴︎
12. E. Mendoza, "Sudden Stops, Financial Crises, and Leverage: A Fisherian Deflation of Tobin's Q," NBER Working Paper No. 14444, October 2008; Z. He and A. Krishnamurthy, "A Macroeconomic Framework for Quantifying Systemic Risk," NBER Working Paper No. 19885, February 2014, revised May 2019. Go to ⤴︎
13. M. Gertler and N. Kiyotaki, "Banking, Liquidity, and Bank Runs in an Infinite-Horizon Economy," NBER Working Paper No. 19129, June 2013; and ibid., NBER Working Paper No. 24126. Go to ⤴︎
14. C. Reinhart and K. Rogoff, This Time is Different: Eight Centuries of Financial Folly, Princeton, N.J.: Princeton University Press, 2009. Go to ⤴︎
15. R. Hall, "Quantifying the Lasting Harm to the U.S. Economy from the Financial Crisis," NBER Working Paper No. 20183, May 2014. Go to ⤴︎
16. J. Fernald, R. Hall, J. Stock, and M. Watson, "The Disappointing Recovery of Output after 2009," NBER Working Paper No. 23543, June 2017. Go to ⤴︎
17. Empirical work by A. Krishnamurthy and A. Vissing-Jorgensen, "The Effects of Quantitative Easing on Interest Rates: Channels and Implications for Policy," NBER Working Paper No. 17555, and others provides evidence for this kind of mechanism. Go to ⤴︎
18. Examples include E. Farhi and I. Werning, "A Theory of Macroprudential Policies in the Presence of Nominal Rigidities," NBER Working Paper No. 19313, and A. Korinek and A. Simsek, "Liquidity Trap and Excessive Leverage," NBER Working Paper No. 19970, March 2014. Go to ⤴︎
19. Examples include E. Farhi and J. Tirole, "Collective Moral Hazard, Maturity Mismatch, and Systemic Bailouts," NBER Working Paper No. 15138, July 2009; V. Chari and P. Kehoe, "Bailouts, Time Inconsistency, and Optimal Regulation," NBER Working Paper No. 19192, June 2013; and J. Bianchi and E. Mendoza, "Optimal Time-Consistent Macroprudential Policy," NBER Working Paper No. 19704, December 2013. Go to ⤴︎
20. I. Werning, "Managing a Liquidity Trap: Monetary and Fiscal Policy," NBER Working Paper No. 17344, August 2011. Go to ⤴︎
21. Research on this topic includes A. McKay, E. Nakamura, and J. Steinsson, "The Power of Forward Guidance Revisited," NBER Working Paper No. 20882, January 2015; M. Garcia-Schmidt and M. Woodford, "Are Low Interest Rates Deflationary? A Paradox of Perfect-Foresight Analysis," NBER Working Paper No. 21614, October 2015; G. Angeletos and C. Lian, "Forward Guidance without Common Knowledge," NBER Working Paper No. 22785, October 2016; and X. Gabaix, "A Behavioral New Keynesian Model," NBER Working Paper No. 22954, December 2016. Go to ⤴︎
22. E. Farhi and I. Werning, "Monetary Policy, Bounded Rationality, and Incomplete Markets," NBER Working Paper No. 23281, March 2017. Go to ⤴︎
23. L. Christiano, M. Eichenbaum, and S. Rebelo, "When Is the Government Spending Multiplier Large?" NBER Working Paper No. 15394, October 2009. Go to ⤴︎
24. E. Nakamura and J. Steinsson, "High Frequency Identification of Monetary Non-Neutrality: The Information Effect," NBER Working Paper No. 19260, July 2013. Go to ⤴︎
25. A. Auerbach and Y. Gorodnichenko, "Fiscal Multipliers in Recession and Expansion," NBER Working Paper No. 17447, September 2011; V. Ramey, "Ten Years after the Financial Crisis: What Have We Learned from the Renaissance in Fiscal Research?" NBER Working Paper No. 25531, February 2019, suggests caution in drawing conclusions about the variation in the fiscal multiplier over the cycle. Go to ⤴︎
26. C. Jones, "The Facts of Economic Growth," NBER Working Paper No. 21142, May 2015, and Handbook of Macroeconomics, 2, 2016, pp. 3–69. Go to ⤴︎
27. P. Aghion, U. Akcigit, and P. Howitt, "What Do We Learn From Schumpeterian Growth Theory?" NBER Working Paper No. 18824, February 2013; and Handbook of Economic Growth, 2, 2016, pp. 515–63. Go to ⤴︎
28. U. Akcigit and S. Ates, "Ten Facts on Declining Business Dynamism and Lessons from Endogenous Growth Theory," NBER Working Paper No. 25755, April 2019. Go to ⤴︎
29. R. Decker, J. Haltiwanger, R. Jarmin, and J. Miranda, "Changing Business Dynamism and Productivity: Shocks vs. Responsiveness," NBER Working Paper No. 24236, January 2018.     Go to ⤴︎
30. J. Haltiwanger, R. Jarmin, and J. Miranda, "Who Creates Jobs? Small vs. Large vs. Young," NBER Working Paper No. 16300, August 2010, and Review of Economics and Statistics, 95(2), 2013, pp. 347–61. Go to ⤴︎
31. U. Akcigit and W. Kerr, "Growth through Heterogeneous Innovations," NBER Working Paper No. 16443, November 2010, and Journal of Political Economy, 126(4), 2018, pp. 1374–1443. Go to ⤴︎
32.  J. Fernald, "Productivity and Potential Output Before, During, and After the Great Recession," NBER Working Paper No. 20248, June 2014, and NBER Macroeconomics Annual 2014, pp. 1–51.   Go to ⤴︎
33. T. Alon, D. Berger, R. Dent, and B. Pugsley,"Older and Slower: The Startup Deficit's Lasting Effects on Aggregate Productivity Growth," NBER Working Paper No. 23875, September 2017, and Journal of Monetary Economics, 93, 2018, pp. 68–85. Go to ⤴︎
34. D. Garcia-Macia, C. Hsieh, and P. Klenow,"How Destructive is Innovation?," NBER Working Paper No. 22953, December 2016, and forthcoming in Econometrica. Go to ⤴︎
35. C. Hottman, S. Redding and D. Weinstein,"Quantifying the Sources of Firm Heterogeneity," NBER Working Paper No. 20436, August 2014, and Quarterly Journal of Economics, 131(3), 2016, pp. 1291–364.   Go to ⤴︎
36. R. Gordon,"Why Has Economic Growth Slowed When Innovation Appears to be Accelerating?" NBER Working Paper No. 24554, April 2018.   Go to ⤴︎
37. N. Bloom, C. Jones, J. Van Reenen, and M. Webb,"Are Ideas Getting Harder to Find?" NBER Working Paper No. 23782, September 2017.   Go to ⤴︎
38. C. Syverson,"Challenges to Mismeasurement Explanations for the U.S. Productivity Slowdown," NBER Working Paper No. 21974, February 2016, and Journal of Economic Perspectives, 31(2), 2017, pp. 165–86.   Go to ⤴︎
39. P. Aghion, A. Bergeaud, T. Boppart, P. Klenow, and H. Li,"Missing Growth from Creative Destruction," NBER Working Paper No. 24023, November 2017, and forthcoming in American Economic Review. Go to ⤴︎
40. D. Restuccia and R. Rogerson,"The Causes and Costs of Misallocation," NBER Working Paper No. 23422, May 2017, and Journal of Economic Perspectives, 31(3), 2017, pp. 151–74.   Go to ⤴︎
41. C. Syverson,"What Determines Productivity?" NBER Working Paper No. 15712, January 2010, and Journal of Economic Literature, 49(2), 2011, pp. 326–65.   Go to ⤴︎
42.  C. Hsieh and P. Klenow,"Misallocation and Manufacturing TFP in China and India," NBER Working Paper No. 13290, August 2007, and Quarterly Journal of Economics, 124(4), pp. 1403–48, 2009.   Go to ⤴︎
43. A. Collard-Wexler, J. Asker, and J. De Loecker,"Productivity Volatility and the Misallocation of Resources in Developing Economies," NBER Working Paper No. 17175, June 2011, and published as "Dynamic Inputs and Resource (Mis)Allocation," Journal of Political Economy, 122(5), 2014, pp. 1013–63.   Go to ⤴︎
44. J.M. David and V. Venkateswaran,"The Sources of Capital Misallocation," NBER Working Paper No. 23129, February 2017, and forthcoming in the American Economic Review. Go to ⤴︎
45. G. Gopinath, S. Kalemli-Ozcan, L. Karabarbounis, and C. Villegas-Sanchez,"Capital Allocation and Productivity in South Europe," NBER Working Paper No. 21453, August 2015, and Quarterly Journal of Economics, 132(4), 2017, pp. 1915–67; Y. Gorodnichenko, D. Revoltella, J. Svejnar, and C.T. Weiss,"Resource Misallocation in European Firms: The Role of Constraints, Firm Characteristics, and Managerial Decisions," NBER Working Paper No. 24444, March 2018. Go to ⤴︎
46. F. Buera, J. Kaboski, and Y. Shin,"Finance and Development: A Tale of Two Sectors," NBER Working Paper No. 14914, April 2009, and American Economic Review, 101(5), 2011, pp. 1964-2002; A. Eisfeldt and Y. Shi,"Capital Reallocation," NBER Working Paper No. 25085, September 2018. Go to ⤴︎
47. V. Midrigan and D.Y. Xu,"Finance and Misallocation: Evidence from Plant-Level Data," NBER Working Paper No. 15647, January 2010, and American Economic Review, 104(2), 2014, pp. 422–58. Go to ⤴︎
48. M. Peters, "Heterogeneous Mark-ups and Endogenous Misallocation," MIT Working Paper, 2011. Go to ⤴︎
49. D. Baqaee and E. Farhi,"Productivity and Misallocation in General Equilibrium," NBER Working Paper No. 24007, November 2017. Go to ⤴︎
50. C. Edmond, V. Midrigan, D. Xu,"How Costly are Markups?" NBER Working Paper No. 24800, July 2018. Go to ⤴︎
51. D. Autor, D. Dorn, L. Katz, C. Patterson, and J. Van Reenen,"The Fall of the Labor Share and the Rise of Superstar Firms," NBER Working Paper No. 23396, May 2017; J. De Loecker and J. Eeckhout,"The Rise of Market Power and the Macroeconomic Implications," NBER Working Paper No. 23687, August 2017. Go to ⤴︎
52. U. Akcigit, H. Alp, and M. Peters,"Lack of Selection and Limits to Delegation: Firm Dynamics in Developing Countries," NBER Working Paper No. 21905, January 2016. Go to ⤴︎
53. C. Hsieh and P. Klenow,"The Life Cycle of Plants in India and Mexico," NBER Working Paper No. 18133, June 2012, and Quarterly Journal of Economics, 129(3), 2014, pp. 1035–84. Go to ⤴︎
54. C. Hsieh, E. Hurst, C. Jones, and P. Klenow,"The Allocation of Talent and U.S. Economic Growth," NBER Working Paper No. 18693, January 2013, and forthcoming in Econometrica. Go to ⤴︎
55. E. Saez and G. Zucman,"Wealth Inequality in the United States since 1913: Evidence from Capitalized Income Tax Data," NBER Working Paper No. 20625, October 2014, and Quarterly Journal of Economics, 131(2), 2016, pp. 519-78. Go to ⤴︎
56. X. Gabaix, J. Lasry, P. Lions, and B. Moll,"The Dynamics of Inequality," NBER Working Paper No. 21363, July 2015, and Econometrica, 84(6), 2016, pp. 2071–111. Go to ⤴︎
57. J. Benhabib, A. Bisin, and M. Luo,"Wealth Distribution and Social Mobility in the U.S.: A Quantitative Approach," NBER Working Paper No. 21721, December 2015, and American Economic Review, 109(5), 2019, pp. 1623–47. Go to ⤴︎
58. A. Fagereng, L. Guiso, D. Malacrino, and L. Pistaferri, "Heterogeneity and Persistence in Returns to Wealth," NBER Working Paper No. 22822, November 2016. Go to ⤴︎
59. D. Krueger, K. Mitman, and F. Perri,"Macroeconomics and Household Heterogeneity," NBER Working Paper No. 22319, June 2016. Go to ⤴︎
60. O. Galor and J. Zeira, "Income Distribution and Macroeconomics," Review of Economic Studies, 60(1), 1993, pp. 35-52. Go to ⤴︎
61. D. Daruich, "The Macroeconomic Consequences of Early Childhood Development Policies," Federal Reserve Bank of Minneapolis System Working Paper 18–18, 2018. Go to ⤴︎
62. M. Doepke and F. Zilibotti,"Parenting with Style: Altruism and Paternalism in Intergenerational Preference Transmission," NBER Working Paper No. 20214, June 2014, and Econometrica, 85(5), 2017, pp. 1331–71. Go to ⤴︎
63. A. Fogli and V. Guerrieri, "The End of the American Dream? Inequality and Segregation in U.S. Cities," Mimeo, University of Chicago, Booth School of Business, 2018. Go to ⤴︎
64. R. Chetty and N. Hendren,"The Impacts of Neighborhoods on Intergenerational Mobility II: County-Level Estimates," NBER Working Paper No. 23002, and Quarterly Journal of Economics, 2018, 133(3), 2018, pp. 1163–1228. Go to ⤴︎
65. L. Eika, M. Mogstad, and B. Zafar,"Educational Assortative Mating and Household Income Inequality," NBER Working Paper No. 20271, July 2014, and forthcoming in Journal of Political Economy. Go to ⤴︎
66. D. Acemoglu and P. Restrepo,"Robots and Jobs: Evidence from U.S. Labor Markets," NBER Working Paper No. 23285, March 2017. Go to ⤴︎
67. D. Autor and A. Salomons,"Is Automation Labor-Displacing? Productivity Growth, Employment, and the Labor Share," NBER Working Paper No. 24871, July 2018. Go to ⤴︎
68. P. Aghion, U. Akcigit, A. Deaton, and A. Roulet,"Creative Destruction and Subjective Well-Being," NBER Working Paper No. 21069, April 2015, and American Economic Review, 106(12), 2016, pp. 3869–97. Go to ⤴︎
69. S. Albanesi and J. Nosal,"Insolvency after the 2005 Bankruptcy Reform," NBER Working Paper No. 24934, August 2018. Go to ⤴︎
70. K. Jakobsen, K. Jakobsen, H. Kleven, and G. Zucman,"Wealth Taxation and Wealth Accumulation: Theory and Evidence from Denmark," NBER Working Paper No. 24371, March 2018. Go to ⤴︎
71. Studies that employ the heterogeneous agent approach to analyze monetary policy include A. Auclert,"Monetary Policy and the Redistribution Channel," NBER Working Paper No. 23451, May 2017; G. Kaplan, B. Moll, and G. Violante,"Monetary Policy According to HANK," NBER Working Paper No. 21897, January 2016; A. McKay, E. Nakamura, and J. Steinsson,"The Power of Forward Guidance Revisited," NBER Working Paper No. 20882, January 2015; and I. Werning,"Incomplete Markets and Aggregate Demand," NBER Working Paper No. 21448, August 2015. Go to ⤴︎
72. Studies that employ the heterogeneous agent approach to analyze fiscal policy include M. Hagdorn, I. Manovskii, and K. Mitman,"The Fiscal Multiplier," NBER Working Paper No. 25571, February 2019; G. Kaplan and G. Violante,"A Model of the Consumption Response to Fiscal Stimulus Payments," NBER Working Paper No. 17338, August 2011; A. McKay and R. Reis,"The Role of Automatic Stabilizers in the U.S. Business Cycle," NBER Working Paper No. 19000, April 2013; and H. Oh and R. Reis,"Targeted Transfers and the Fiscal Response to the Great Recession," NBER Working Paper No. 16775, February 2011. Go to ⤴︎
73. E. Nakamura and J. Steinsson,"Fiscal Stimulus in a Monetary Union: Evidence from U.S. Regions," NBER Working Paper No. 17391, September 2011. Go to ⤴︎
74. M. Beraja, E. Hurst, and J. Ospina,"The Aggregate Implications of Regional Business Cycles," NBER Working Paper No. 21956, February 2016. Go to ⤴︎
75. M. Beraja, A. Fuster, E. Hurst, and J. Vavra,"Regional Heterogeneity and Monetary Policy," NBER Working Paper No. 23270, March 2017, and Quarterly Journal of Economics, 134(1), 2019, pp. 109-83. Go to ⤴︎
76. R. Adão, C. Arkolakis, and F. Esposito,"Spatial Linkages, Global Shocks, and Local Labor Markets: Theory and Evidence," NBER Working Paper No. 25544, February 2019. Go to ⤴︎
77. C. Jones, V. Midrigan, and T. Philippon,"Household Leverage and the Recession," NBER Working Paper No. 16965, April 2011 Go to ⤴︎

More from NBER

In addition to working papers, the NBER disseminates affiliates’ latest findings through a range of free periodicals — the NBER Reporter, the NBER Digest, the Bulletin on Retirement and Disability, and the Bulletin on Health — as well as online conference reports, video lectures, and interviews.

Economics of Digitization Figure 1
  • Article
The NBER Economics of Digitization Project, established in 2010 with support from the Alfred P. Sloan Foundation,...
claudiagoldinpromoimagelecture.png
  • Lecture
Claudia Goldin, the Henry Lee Professor of Economics at Harvard University and a past president of the American...
2020 Methods Lecture Promo Image
  • Lecture
The extent to which individual responses to household surveys are protected from discovery by outside parties depends...

NBER periodicals, and newsletters are not copyrighted and may be reproduced freely with appropriate attribution.