Alberto Polo

We estimate intergenerational income mobility in Italy using administrative data from tax returns. Our estimates of mobility in Italy are higher than prior work using survey data and other indirect methods. The rank-rank slope of parent-child income in Italy is 0.22, compared to 0.18 in Denmark and 0.34 in the United States. The probability that a child reaches the top quintile of the national income distribution starting from a family in the bottom quintile is 0.11. Upward mobility is higher for sons and first-born children. We uncover substantial geographical variation: upward mobility rates are much higher in Northern Italy, where provinces have higher measured school quality, more stable families, and more favorable labor market conditions.

Last version

Coverage (in Italian): articolo di Linkiesta.it, articolo de Il Foglio, articolo di lavoce.info

Coverage (in English): video of the presentation at the FRdB Conference

I document three salient features of the transmission of monetary policy shocks: imperfect pass-through to deposit rates, impact on credit spreads, and substitution between deposits and other bank liabilities. I develop a monetary model consistent with these facts, where banks have market power on deposits, a duration-mismatched balance sheet, and a dividend-smoothing motive. Deposit demand has a dynamic component, as in the literature on customer markets. A financial friction makes non-deposit funding supply imperfectly elastic. The model indicates that imperfect pass-through to deposit rates is an important source of amplification of monetary policy shocks. An alternative source of liquidity to deposits, such as a central bank digital currency, can further amplify transmission.

July 2022 version

What are the quantitative implications of countercyclical labor earnings risk? This paper investigates the welfare effects of eliminating business cycles when households face cyclical changes in the skewness of the labor earnings distribution as estimated by Guvenen, Ozkan and Song (2014). Using a heterogeneous agent, general equilibrium model with aggregate shocks I find that the average welfare effect can be as large as 9% of lifetime consumption. The welfare gain comes entirely from removing cyclical changes in the distribution of persistent idiosyncratic shocks. At the individual level, the welfare gain is increasing in earnings and decreasing in wealth. Low-earnings, low-wealth households however have little to lose from countercyclical risk and prefer the economy with aggregate fluctuations.

September 2018 version