James Paron

• Maxwell Miller, James Paron, Jessica Wachter (Working), Sovereign default and the decline in interest rates. Abstract

  Sovereign debt yields have declined dramatically over the last half-century. Standard explanations, including aging populations and increases in asset demand from abroad, encounter difficulties when confronted with the full range of evidence. We propose an explanation based on a decline in inflation and default risk, which we argue is more consistent with the long-run nature of the interest rate decline. We show that a model with investment, inventory storage, and sovereign default captures the decline in interest rates, the stability of equity valuation ratios, and the recent reduction in investment and output growth coinciding with the binding zero lower bound.

• James Paron (Working), Heterogeneous-agent asset pricing: Timing and pricing idiosyncratic risks. Abstract

  This paper studies the importance of idiosyncratic endowment shocks for aggregate asset prices in a generalized continuous-time framework that accommodates both jumps and recursive preferences. I show that, regardless of the presence of jumps, countercyclical cross-sectional risk is irrelevant to risk premia if and only if (i) all agents have time-additive power utility and (ii) cross-sectional risk is uncorrelated with aggregate consumption risk. To quantify the relevance of these conditions, I calibrate a general-equilibrium model with a continuum of recursive-utility agents who face uninsurable idiosyncratic human-capital disasters. The model explains both asset pricing moments and cross-sectional income moments from Social Security Administration income data.

Past Courses

• NRSC2273 - Neuroeconomics

  This course will introduce students to neuroeconomics, a field of research that combines economic, psychological, and neuroscientific approaches to study decision-making. The course will focus on our current understanding of how our brains give rise to decisions, and how this knowledge might be used to constrain or advance economic and psychological theories of decision-making. Topics covered will include how individuals make decisions under conditions of uncertainty, how groups of individuals decide to cooperate or compete, and how decisions are shaped by social context, memories, and past experience.

• PSYC2555 - Neuroeconomics

  This course will introduce students to neuroeconomics, a field of research that combines economic, psychological, and neuroscientific approaches to study decision-making. The course will focus on our current understanding of how our brains give rise to decisions, and how this knowledge might be used to constrain or advance economic and psychological theories of decision-making. Topics covered will include how individuals make decisions under conditions of uncertainty, how groups of individuals decide to cooperate or compete, and how decisions are shaped by social context, memories, and past experience.

Knowledge @ Wharton

• Summer Reading: Wharton Faculty Picks, Knowledge @ Wharton - 07/23/2024
• What Does Your Writing Style Say About You?, Knowledge @ Wharton - 07/23/2024
• How to Align Private Equity Motives with Nursing Home Outcomes, Knowledge @ Wharton - 07/22/2024
• Baby Bust | Stewart Friedman, Knowledge @ Wharton - 07/16/2024
• Why Are Private Equity Firms Buying Mental Health Clinics?, Knowledge @ Wharton - 07/15/2024
• Who Benefits in the Deal Between Reddit and OpenAI?, Knowledge @ Wharton - 07/15/2024
• How Behavioral Factors Shape Retirement Wealth, Knowledge @ Wharton - 07/15/2024
• Stocks for the Long Run | Jeremy Siegel, Knowledge @ Wharton - 07/09/2024
• This Media Bias Detector Analyzes News Reports in Real Time, Knowledge @ Wharton - 07/09/2024
• Are Corporate Human Rights Practices Up to Par?, Knowledge @ Wharton - 07/08/2024