Noah Kwicklis

Research

Publications

• Active vs. passive policy and the trade-off between output and inflation in HANK. Journal of Monetary Economics, April 2025, Vol. 151. Article 103732.

  When fiscal policy is active and monetary policy is passive in a heterogeneous agent New Keynesian (HANK) model, deficit-financed transfers to low-asset households lead to similar cumulative inflation but greater increases in real output than transfers to wealthier households. I use the inverse of the “Phillips multiplier”, the price level sacrifice ratio, to quantify this dynamic. Household heterogeneity and targeted policy change the timing of output gaps, making this consistent with the Phillips Curve and rendering conventional sacrifice ratio intuition misleading for assessing the inflation/output trade-off between policies.

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Working Papers

• Sticky Expectations, Fiscal Transfers, Inflation, and Unemployment in HANK (Job Market Paper)

  I develop a new technique to numerically solve sticky-expectation heterogeneous agent models in state space. I use this methodology to study the effects of the post-COVID fiscal stimulus in an estimated medium-scale heterogeneous agent New Keynesian (HANK) model. Sticky information frictions triple the one-year transfer multiplier of a stimulus check intervention from 0.10 to 0.30. In the absence of fiscal transfer stimulus in 2020 and 2021, the model predicts the COVID-19 recession would have induced a 33% larger average cumulative real GDP per capita loss relative to the pre-pandemic trend. Despite being highly stimulative in the incomplete markets setting, the model suggests that transitory fiscal transfers have relatively modest impacts on inflation and unemployment.

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Conference Presentations

• Fiscal HANK Presentation, Econometric Society's 2024 North American Summer Meeting (NASM)

Blog Posts

• Will New Steel Tariffs Protect U.S. Jobs? with Mary Amiti and Sebastian Heise
• The Impact of Import Tariffs on U.S. Domestic Prices with Mary Amiti and Sebastian Heise

Dormant Working Papers

• Poverty, the EITC, and the Mental Health of Children and Adolescents

  I hypothesize that cash transfers to poor households improve the mental health of recipient children. Specifically, I posit that the 1993 Omnibus Budget Reconciliation Act’s expansion of the Earned Income Tax Credit (EITC) could have worked through a number of mechanisms to reduce the incidence of depression, anxiety, and antisocial behavior among children in eligible households, as reported by broad survey indexes. To test this claim, I estimate the intent-to-treat (ITT) effect of the EITC using a difference-in-differences (DID) identification strategy, with linear controls and household and region fixed effects. I find evidence that the federal tax credit expansion reduced externalizing behavior and tendencies among low- income children.

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