Joachim Jungherr


University of Bonn
Institute for Macroeconomics and Econometrics
Kaiserplatz 7-9, 4th floor
53113 Bonn, Germany
joachim.jungherr@uni-bonn.de

About me:
I am a Post-doc Researcher at the Institute for Macroeconomics and Econometrics of the University of Bonn (Germany). Before joining Bonn, I was a Post-doc at the Institut d'Anŗlisi EconÚmica (IAE-CSIC), MOVE, and Affiliated Professor at the Barcelona School of Economics in Barcelona (Spain). I received my PhD from the European University Institute in Florence (Italy). A detailed CV can be found here.










Mannheim Workshop on Firm Heterogeneity and Macroeconomics

WORKSHOP PROGRAM

Workshop date: 10-11 December 2021 (Mannheim, Germany)
Keynote speakers: Simon Gilchrist (NYU) and Virgiliu Midrigan (NYU)
Organizing Committee: Matthias Meier (Universitšt Mannheim), Isaac Baley (Universitat Pompeu Fabra), Joachim Jungherr (Universitšt Bonn), Immo Schott (Universitť de Montrťal)



Work in Progress






Corporate Debt Maturity Matters for Monetary Policy
(with Matthias Meier, Timo Reinelt, and Immo Schott, November 2021)

We provide novel empirical evidence that firms' investment is more responsive to surprise changes in monetary policy when a higher fraction of their debt matures. In a heterogeneous firm New Keynesian model with financial frictions and endogenous debt maturity, two channels explain this finding: (1.) Firms with more maturing debt roll over more debt and are therefore more exposed to fluctuations in the real interest rate (roll-over risk). (2.) Firms with shorter debt maturity have higher default risk in equilibrium and therefore react more strongly to changes in the real burden of outstanding nominal debt (debt overhang). The aggregate effectiveness of monetary policy depends on the joint distribution of debt maturity and default risk across firms.





Publications










Slow Debt, Deep Recessions
(with Immo Schott)
(March 2020, forthcoming at American Economic Journal: Macroeconomics)

Working Paper

Business credit lags GDP growth by about one year. This contributes to high leverage during recessions and slow deleveraging. We show that a model in which firms use risky long-term debt replicates this slow adjustment of firm debt. In the model, slow-moving debt has important effects for real activity. High levels of firm debt issued during expansions are only gradually reduced during recessions. This generates an adverse feedback loop between high default rates and low investment and thereby amplifies the downturn. Sluggish deleveraging slows down the recovery. The equilibrium is constrained inefficient because firms exert an externality on the holders of previously issued debt. The constrained efficient allocation substantially reduces macroeconomic volatility.











Optimal Debt Maturity and Firm Investment
(with Immo Schott)
Review of Economic Dynamics, Vol. 42, October 2021, pp. 110-132

Working Paper

We introduce long-term debt and a maturity choice into a dynamic model of production, firm financing, and costly default. Long-term debt saves roll-over costs but increases future leverage and default rates because of a commitment problem. The model generates rich distributions of maturity choices, leverage ratios, and credit spreads across firms. It explains why larger and older firms borrow at longer maturities, have higher leverage, and pay lower credit spreads. Firms' maturity choice matters for policy: A financial reform which increases investment and output in a standard model of short-term debt can have the opposite effect in a model with short-term debt and long-term debt.






Bank Opacity and Financial Crises
Journal of Banking & Finance, Vol. 97, December 2018, pp. 157-176

Working Paper; Barcelona GSE Focus

This paper studies a model of endogenous bank opacity. Why do banks choose to hide their risk exposure from the public? And should policy makers force banks to be more transparent? In the model, bank opacity is costly because it encourages banks to take on too much risk. But opacity also reduces the incidence of bank runs (for a given level of risk taking). Banks choose to be inefficiently opaque if the composition of their asset holdings is proprietary information. In this case, policy makers can improve upon the market outcome by imposing public disclosure requirements (such as Pillar Three of Basel II). However, full transparency maximizes neither efficiency nor stability. The model can explain why empirically a higher degree of bank competition leads to increased transparency.



Teaching









Introduction to Economics: Macroeconomics
(University of Bonn - B.Sc. in Economics: 2019, 2020, 2021, 2021/22)

Macroeconomics (Part 1/2)
(University of Bonn - M.Sc. in Economics: 2018)

Firm Debt and Macroeconomic Policy
(Barcelona GSE - Macroeconomic Policy and Financial Markets: 2019, 2020, 2021)

Foundations of Equilibrium Analysis (Part 2/2)
(Barcelona GSE - Macroeconomic Policy and Financial Markets: 2015, 2016, 2017)

Introduction to Economics
(Universitat AutÚnoma de Barcelona - B.Sc. in Economics: 2014)

                         



Last updated: November 2021