Journal Article
How Important Are Production Networks to the U.S. Economy?
Hong, Sungki; Sun, Qiuhan; Shell, Hannah (2018)
As manufacturing grows more sophisticated, industries become more interconnected through production networks.
The Regional Economist , Volume 26 , Issue 4

Journal Article
Moving In, Moving Out: The Migration Pattern of the Eighth District
Hong, Sungki; Shell, Hannah (2019)
Education and income differed between those leaving and those entering the District states from 2013-2017.
The Regional Economist , Volume 27 , Issue 3

Journal Article
U.S. States Hit the Hardest by COVID-19 Have Lower Unemployment Risks
Werner, Devin; Hong, Sungki (2020-04-03)
States with relatively more COVID-19 cases tend to have a workforce less likely to face unemployment.
Economic Synopses , Issue 12

Working Paper
Markup Cyclicality: A Tale of Two Models
Hong, Sungki (2017-09-21)
Many models in the business cycle literature generate counter-cyclical price markups. This paper examines if the prominent models in the literature are consistent with the empirical findings of micro-level markup behavior in Hong (2016). In particular, I test the markup behavior of the following two models: (i) an oligopolistic competition model, and (ii) a New Keynesian model with heterogeneous price stickiness. First, I explore the Atkeson and Burstein (2008) model of oligopolistic competition, in which markups are an increasing function of firm market shares. Coupled with an exogenous ...
Working Papers , Paper 2017-34

What Are the Fed’s Dollar Swap Lines and FIMA Repos, and Why Do They Matter?
Werner, Devin; Hong, Sungki (2020-10-08)
Making it easier for central banks to access U.S. dollars helps calm exchange rate volatility and allow markets and credit lines to operate smoothly.
On the Economy

Working Paper
Customer Capital, Markup Cyclicality, and Amplification
Hong, Sungki (2017-04-30)
This paper studies the importance of firm-level price markup dynamics for business cycle fluctuations. Using state-of-the-art IO techniques to measure the behavior of markups over the business cycle at the firm level, I find that markups are countercyclical with an average elasticity of -1.1 with respect to real GDP. Importantly, I find substantial heterogeneity in markup cyclicality across firms, with small firms having significantly more counter-cyclical markups than large firms. Then, I develop a general equilibrium model by embedding customer capital (due to deep habits as in Ravn, ...
Working Papers , Paper 2017-33

Working Paper
Capital Gains Taxation and Investment Dynamics
Hong, Sungki; Moon, Terry S. (2018-10-31)
This paper quanti?es the long-run effects of reducing capital gains taxes on aggregate investment. We develop a dynamic general equilibrium model with heterogeneous ?rms, which face discrete capital gains tax rates based on their ?rm size. We calibrate our model by targeting relevant micro moments as well as the difference-in-differences estimate of the capital elasticity based on the institutional setting and a policy reform in Korea. We ?nd that the ?rm-size reform that reduced the capital gains tax rates from 24 percent to 10 percent for the affected ?rms increased aggregate investment by ...
Working Papers , Paper 2018-31

Journal Article
Factors Behind the Decline in the U.S. Natural Rate of Interest
Hong, Sungki; Shell, Hannah (2019-04-19)
Longer lives and fewer babies have contributed to a lower natural rate of interest.
Economic Synopses , Issue 11

Firms Start with Fewer Employees over Last 25 Years
Werner, Devin; Hong, Sungki (2020-09-08)
The average new firm that is less than a year old had 20% fewer workers in 2019 than it did in 1994.
On the Economy

Startups Account for Smaller Share of U.S. Jobs
Werner, Devin; Hong, Sungki (2020-06-23)
Since 1994, startup firms have seen their share of U.S. employment shrink.
On the Economy