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Patrick J. Kehoe Monetary Advisor

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Patrick Kehoe is a Monetary Advisor and has been affiliated with the Bank since 1986. He is a Senior Fellow at the Stanford Institute for Economic Policy Research (SIEPR) and Professor of Economics at the Stanford Economic Department, positions he has held since 2015. Prior to that, he taught at the University of Minnesota, where he was a Frenzel Professor of International Economics, Princeton University, where he was a Frank Graham Professor of International Economics, the University College London, and the University of Pennsylvania, where he was the Lauder Professor of International Economics.

He received his PhD in economics from Harvard University in 1986. His research focuses on international macroeconomics. Recently, he has focused on developing business cycle models that quantitatively account for the Great Recession and developing optimal bailout policies during such downturns. Prior to that he worked on categorizing patterns of business cycles across countries and over time, new models of financial frictions, optimal monetary and fiscal policy, time inconsistency issues in policies.

Kehoe is a Fellow of the Econometric Society, a Senior Fellow at the Stanford Institute for Economic Policy Research, and a Faculty Research Fellow at the National Bureau of Economic Research. He has been on the Board of Editors of the American Economic Review, a co-editor of the International Economic Review, an associate editor of the Journal of International Economics, and an associate editor of the Quarterly Review of the Federal Reserve Bank of Minneapolis.

On the Optimality of Financial Repression
2020 | Journal of Political Economy, 128(2): 710-739 | With V. V. Chari and Alessandro Dovis

Financial Frictions and Fluctuations in Volatility
2019 | Journal of Political Economy, 127(5): 2049-2103 | With Cristina Arellano and Yan Bai
Previously: Federal Reserve Bank of Minneapolis Staff Report 466
Related: Staff Report 538: Appendix for Financial Frictions and Fluctuations in Volatility

Debt Constraints and Employment
2019 | Journal of Political Economy, 127(4): 1926-1991 | With Virgiliu Midrigan and Elena Pastorino
Previously: Federal Reserve Bank of Minneapolis Staff Report 536

Evolution of Modern Business Cycle Models: Accounting for the Great Recession
2018 | Journal of Economic Perspectives, 32(3): 141-166 | With Virgiliu Midrigan and Elena Pastorino
Previously: Federal Reserve Bank of Minneapolis Staff Report 566

Fiscal Unions Redux
2017 | Economic Theory, 64(4): 741-776 | With Elena Pastorino
Previously: Federal Reserve Bank of Minneapolis Staff Report 543

Bailouts, Time Inconsistency, and Optimal Regulation: A Macroeconomic View
2016 | American Economic Review, 106 (9): 2458-2493 | With V. V. Chari
Previously: Federal Reserve Bank of Minneapolis Staff Report 481

Debt Constraints and the Labor Wedge
2016 | American Economic Review, 106(5): 548-553 | With Virgiliu Midrigan and Elena Pastorino

Accounting for Business Cycles
2016 | Handbook of Macroeconomics, 2(13): 1013-1063 | With Pedro Brinca, V. V. Chari, and Ellen R. McGrattan
Previously: Federal Reserve Bank of Minneapolis Staff Report 531

Macroeconomic Volatility and External Imbalances
2015 | Journal of Monetary Economics, 69: 1-15 | With Fabrizio Perri
Previously: Federal Reserve Bank of Minneapolis Staff Report 512

Prices are Sticky After All
2015 | Journal of Monetary Economics, 75: 35-53 | With Virgiliu Midrigan
Previously: Federal Reserve Bank of Minneapolis Staff Report 413

Sophisticated Monetary Policies
2010 | The Quarterly Journal of Economics, 125(1): 47-89 | With Andrew Atkeson and V. V. Chari
Previously: Federal Reserve Bank of Minneapolis Staff Report 419
Previously: Federal Reserve Bank of Minneapolis Working Paper 659

Time-Varying Risk, Interest Rates, and Exchange Rates in General Equilibrium
2009 | Review of Economic Studies, 76(3): 851-878 | With Fernando Alvarez and Andrew Atkeson
Previously: Federal Reserve Bank of Minneapolis Staff Report 371
Previously: Federal Reserve Bank of Minneapolis Working Paper 627

On the Need for a New Approach to Analyzing Monetary Policy
2009 | NBER Macroeconomics Annual 2008, 23: 389-425 | With Andrew Atkeson
Previously: Federal Reserve Bank of Minneapolis Staff Report 412
Previously: Federal Reserve Bank of Minneapolis Working Paper 662

New Keynesian Models: Not Yet Useful for Policy Analysis
2009 | American Economic Journal: Macroeconomics, 1(1): 242-266 | With V. V. Chari and Ellen R. McGrattan
Previously: Federal Reserve Bank of Minneapolis Staff Report 409
Previously: Federal Reserve Bank of Minneapolis Working Paper 664

Are Structural VARs with Long-Run Restrictions Useful in Developing Business Cycle Theory?
2008 | Journal of Monetary Economics, 55(8): 1337-1352 | With V. V. Chari and Ellen R. McGrattan
Previously: Federal Reserve Bank of Minneapolis Staff Report 364

Time Inconsistency and Free-Riding in a Monetary Union
2008 | Journal of Money, Credit and Banking, 40(7): 1329-1356 | With V. V. Chari
Previously: Federal Reserve Bank of Minneapolis Staff Report 308

On the Need for Fiscal Constraints in a Monetary Union
2007 | Journal of Monetary Economics, 54(8): 2399-2408 | With V. V. Chari
Previously: Federal Reserve Bank of Minneapolis Working Paper 589

If Exchange Rates are Random Walks, Then Almost Everything We Say About Monetary Policy is Wrong
2007 | American Economic Review, 97(2): 339-345 | With Fernando Alvarez and Andrew Atkeson
Previously: Federal Reserve Bank of Minneapolis Quarterly Review 3211
Previously: Federal Reserve Bank of Minneapolis Staff Report 388
Previously: Federal Reserve Bank of Minneapolis Working Paper 650

Business Cycle Accounting
2007 | Econometrica, 75(3): 781-836 | With V. V. Chari and Ellen R. McGrattan
Previously: Federal Reserve Bank of Minneapolis Staff Report 328
Related: Staff Report 362: Appendices: Business Cycle Accounting

Modeling the Transition to a New Economy: Lessons from Two Technological Revolutions
2007 | American Economic Review, 97(1): 64-88 | With Andrew Atkeson
Previously: Federal Reserve Bank of Minneapolis Staff Report 296

Modern Macroeconomics in Practice: How Theory Is Shaping Policy
2006 | Journal of Economic Perspectives, 20(4): 3-28 | With V. V. Chari
Previously: Federal Reserve Bank of Minneapolis Staff Report 376

Modeling and Measuring Organization Capital
2005 | Journal of Political Economy, 113(5): 1026-1053 | With Andrew Atkeson
Previously: Federal Reserve Bank of Minneapolis Staff Report 291

The Optimal Degree of Discretion in Monetary Policy
2005 | Econometrica, 73(5): 1431-1475 | With Susan Athey and Andrew Atkeson
Previously: Federal Reserve Bank of Minneapolis Staff Report 326
Previously: Federal Reserve Bank of Minneapolis Working Paper 626

Sudden Stops and Output Drops
2005 | American Economic Review, 95(20: 381-387 | With V. V. Chari and Patrick J. Kehoe
Previously: Federal Reserve Bank of Minneapolis Staff Report 353

Comment on: "Determinants of Business Cycle Comovement: A Robust Analysis"
2005 | Journal of Monetary Economics, 52(1): 159-162
Previously: Federal Reserve Bank of Minneapolis Staff Report 349

Financial Crises as Herds: Overturning the Critiques
2004 | Journal of Economic Theory, 119(1): 128-150 | With V. V. Chari
Previously: Federal Reserve Bank of Minneapolis Staff Report 316
Previously: Federal Reserve Bank of Minneapolis Working Paper 600

Competitive Equilibria with Limited Enforcement
2004 | Journal of Economic Theory, 119(1): 184-206 | With Fabrizio Perri
Previously: Federal Reserve Bank of Minneapolis Staff Report 307
Previously: Federal Reserve Bank of Minneapolis Working Paper 621

Deflation and Depression: Is There an Empirical Link?
2004 | American Economic Review, 94(2): 99-103 | With Andrew Atkeson
Previously: Federal Reserve Bank of Minneapolis Staff Report 331

The Time Consistency of Optimal Monetary and Fiscal Policies
2004 | Econometrica, 72(2): 541-567 | With Fernando Alvarez and Pablo Andrés Neumeyer
Previously: Federal Reserve Bank of Minneapolis Staff Report 305
Previously: Federal Reserve Bank of Minneapolis Working Paper 616

International Business Cycles with Endogenous Incomplete Markets
2003 | Econometrica, 70(3): 907-928 | With Fabrizio Perri
Previously: Federal Reserve Bank of Minneapolis Staff Report 265

Hot Money
2003 | Journal of Political Economy, 111(6): 1262-1292 | With V. V. Chari
Previously: Federal Reserve Bank of Minneapolis Staff Report 228

Can Sticky Price Models Generate Volatile and Persistent Real Exchange Rates?
2002 | Review of Economic Studies, 69(3): 533-563 | With V. V. Chari and Ellen R. McGrattan
Previously: Federal Reserve Bank of Minneapolis Staff Report 277
Previously: Federal Reserve Bank of Minneapolis Staff Report 223
Related: Staff Report 277: Technical Appendix: Can Sticky Price Models Generate Volatile and Persistent Real Exchange Rates?

Policy-Driven Productivity in Chile and Mexico in the 1980's and 1990's
2002 | American Economic Review, 92(2): 16-21 | With Raphael Bergoeing, Timothy J. Kehoe and Raimundo Soto

Accounting for the Great Depression
2002 | American Economic Review, 92(2): 22-27 | With V. V. Chari and Ellen R. McGrattan
Previously: Federal Reserve Bank of Minneapolis Quarterly Review 2721
Previously: Federal Reserve Bank of Minneapolis Working Paper 619
Related: Working Paper 619: Technical Appendix: Accounting for the Great Depression

Money, Interest Rates, and Exchange Rates with Endogenously Segmented Markets
2002 | Journal of Political Economy, 110(1): 73-112 | With Fernando Alvarez and Andrew Atkeson

A Decade Lost and Found: Mexico and Chile in the 1980s
2002 | Review of Economic Dynamics, 5(1): 166-205 | With Raphael Bergoeing, Timothy J. Kehoe and Raimundo Soto
Previously: Federal Reserve Bank of Minneapolis Staff Report 292

Sticky Price Models of the Business Cycle: Can the Contract Multiplier Solve the Persistence Problem?
2000 | Econometrica, 68(5): 1151-1179 | With V. V. Chari and Ellen R. McGrattan
Previously: Federal Reserve Bank of Minneapolis Staff Report 217

Optimal Fiscal and Monetary Policy
1999 | Handbook of Macroeconomics, 1(26): 1671-1745 | With V. V. Chari
Previously: Federal Reserve Bank of Minneapolis Staff Report 251

Models of Energy Use: Putty-Putty versus Putty-Clay
1999 | American Economic Review, 89(4): 1028-1043 | With Andrew Atkeson
Previously: Federal Reserve Bank of Minneapolis Staff Report 230

Comment on M. Obstfeld, “Open‐Economy Macroeconomics: Developments in Theory and Policy”
1998 | Scandinavian Journal of Economics, 100(1): 277-283 | With Asbjørn Rødseth

Models of Sovereign Debt: Partial versus General Reputations
1998 | International Economic Review, 39(1): 55-70 | With Harold L. Cole
Previously: Federal Reserve Bank of Minneapolis Working Paper 580

Social Insurance and Transition
1996 | International Economic Review, 37(2): 377-401 | With Andrew Atkeson
Previously: Federal Reserve Bank of Minneapolis Staff Report 202
Previously: Federal Reserve Bank of Minneapolis Working Paper 547

Optimality of the Friedman Rule in Economies with Distorting Taxes
1996 | Journal of Monetary Economics, 37(2): 203-223 | With V. V. Chari and Lawrence J. Christiano
Previously: Federal Reserve Bank of Minneapolis Staff Report 158

The Role of Institutions in Reputation Models of Sovereign Debt
1995 | Journal of Monetary Economics, 35(1): 45-64 | With Harold L. Cole
Previously: Federal Reserve Bank of Minneapolis Staff Report 179

Dynamics of the Trade Balance and the Terms of Trade: The J-Curve?
1994 | American Economic Review, 84(1): 84-103 | With David K. Backus and Finn E. Kydland
Previously: Federal Reserve Bank of Minneapolis Discussion Paper 65

Optimal Fiscal Policy in a Business Cycle Model
1994 | Journal of Political Economy, 102(4): 617-652 | With V. V. Chari and Lawrence J. Christiano
Previously: Federal Reserve Bank of Minneapolis Staff Report 160
Related: Working Paper 567: Technical Appendix to Optimal Fiscal Policy in a Business Cycle Model

Sustainable Plans and Mutual Default
1993 | Review of Economic Studies, 60(1): 175-195 | With V. V. Chari
Previously: Federal Reserve Bank of Minneapolis Staff Report 124

In Search of Scale Effects in Trade and Growth
1992 | Journal of Economic Theory, 58(2): 377-409 | With David K. Backus and Timothy J. Kehoe
Previously: Federal Reserve Bank of Minneapolis Staff Report 152

International Evidence of the Historical Properties of Business Cycles
1992 | American Economic Review, 82(4): 864-888 | With David K. Backus
Previously: Federal Reserve Bank of Minneapolis Staff Report 145

International Real Business Cycles
1992 | Journal of Political Economy, 100(4): 745-775 | With David K. Backus and Finn E. Kydland
Previously: Federal Reserve Bank of Minneapolis Staff Report 146
Previously: Federal Reserve Bank of Minneapolis Working Paper 426

Sustainable Plans and Debt
1993 | Journal of Economic Theory, 61(2): 230-261 | With V. V. Chari
Previously: Federal Reserve Bank of Minneapolis Staff Report 125

Optimal Fiscal and Monetary Policy: Some Recent Results
1991 | Journal of Money, Credit, and Banking, 23(3) pt 2: 519-539 | With V. V. Chari and Lawrence J. Christiano
Previously: Federal Reserve Bank of Minneapolis Staff Report 147

International Coordination of Fiscal Policy in Limiting Economies
1990 | Journal of Political Economy, 98(3): 617-636 | With V. V. Chari
Previously: Federal Reserve Bank of Minneapolis Staff Report 121

Sustainable Plans
1990 | Journal of Political Economy, 98(4): 783-802 | With V. V. Chari
Previously: Federal Reserve Bank of Minneapolis Staff Report 122

On the Denomination of Government Debt : A Critique of the Portfolio Balance Approach
1989 | Journal of Monetary Economics, 23(3): 359-376 | With David K. Backus
Previously: Federal Reserve Bank of Minneapolis Staff Report 116

Policy Cooperation Among Benevolent Governments May Be Undesirable
1989 | Review of Economic Studies, 56(2): 289-296
Previously: Federal Reserve Bank of Minneapolis Staff Report 103

On the Roles of International Financial Markets and Their Relevance for Economic Policy: Comment
1988 | Journal of Money, Credit and Banking, 20(3): 550-554

Coordination of Fiscal Policies in a World Economy
1987 | Journal of Monetary Economics, 19(3): 349-376
Previously: Federal Reserve Bank of Minneapolis Staff Report 98