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October 29, 2023
Alexandros Theloudis
Assistant Professor of Economics, Tilburg University
Overview
We measure the extent of consumption insurance to income shocks accounting for high-order moments of the income distribution. We derive a nonlinear consumption function, in which the extent of insurance varies with the sign and magnitude of income shocks. Using PSID data, we estimate an asymmetric pass-through of bad versus good permanent shocks – 17% of a 3σ negative shock transmits to consumption compared to 9% of an equal-sized positive shock – and the pass-through increases as the shock worsens. Our results are consistent with surveys of consumption responses to hypothetical events and suggest that tail income risk matters substantially for consumption.
Biography
Daniel Khashabi is an assistant professor in computer science at Johns Hopkins University and a member of the Center for Language and Speech Processing (CLSP). Khashabi’s work focuses on computational foundations of intelligent behavior within various mediums of communication, particularly natural language. This involves developing formalisms that characterize and result in natural language processing (NLP) systems that are capable of understanding and reasoning with (and about) an uncertain world while being general to handle a broader space of contexts. He obtained a Ph.D. from the University of Pennsylvania in 2019 and a BSc from Amirkabir University of Technology (Tehran Polytechnic) in 2012. Before joining Johns Hopkins, he was a postdoctoral fellow at the Allen Institute for AI (2019-2022).
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