Research

Modeling the Asymmetric Effects of an Oil Price Shock, with Benjamin Keen. This paper analyzes a New Keynesian (DSGE) model in the presence of downward nominal wage rigidity. Update: This paper has been accepted for publication by International Journal of Central Banking.

Oil Prices and the Macroeconomy, a chapter for the Handbook of Energy Economics I coauthored with Michael Plante.

Are There Price Asymmetries in the U.S. Beef Market? with Veronica Pozo and Ted Schroeder. Update: After many years, I’m happy to report that this paper has been accepted for publication at the Journal of Commodity Markets.

Oil Shocks and Stock Return Volatility, with Soheil Nadimi. This note (which it was prior to the peer review process) shows that the relationship between oil price volatility and stock return volatility has been sufficiently unstable to make it useless for forecasting stock return volatility. I don’t know a lot about finance - we were making a straightforward point about the limitations of the econometrics that had been used in the prior literature.

Research Interests

I consider myself to be a macroeconomist. I’m interested in the adjustment of aggregate variables such as GDP, inflation, and unemployment to large shocks. In recent years, that has mostly involved looking at the response of the economy to energy shocks.

Surely some of my interest in energy can be attributed to my childhood experiences. I grew up in a farming community affected by the high oil prices of the second oil shock, my father ran an excavating business that was heavily impacted by changes in the price of fuel, and I was living in oil country in Belfield, ND when oil plummeted from $30/barrel to $12/barrel. I was seeing the world from both sides (producer and consumer) as an oil boom turned into a bust.

My views on methodology have changed dramatically since grad school. In those days, I was a big fan of the VAR methodology, because it allowed one to study important issues without imposing too many assumptions. Although I wouldn’t describe myself as a fan of DSGE models, my views have evolved to prefer a more structural approach.

I used to do tax revenue forecasting for the state of Kansas and consulting for private companies. I found it to be quite satisfying to work on practical problems. As a result, I came to respect “applied” research. One of the things I like about Energy Economics is the greater openness to publishing applied work than you find in a typical economics journal.

I consider computation to be my strongest research skill.¹ I can usually pick up new computational tools quickly. That might be another reason I feel more comfortable working on macroeconomic problems.