Dana Galizia
2022 SSHRC Insight Grant
Unemployment Risk, Self-Insurance, and the Business Cycle
Standard economic theory predicts that workers have an incentive to put aside “rainy day” savings for use if and when they become unemployed. One implication of this is that if workers’ fears of becoming unemployed increase, they will reduce their spending on goods and services (“tighten their belts”) so as to increase these savings. This cut in consumer spending may then in turn cause or exacerbate a business cycle downturn. This research project aims to understand how important this mechanism actually is in the real world, and what the implications are for optimal macroeconomic policy.
2019 SSHRC Insight Development Grant
Emergent Behaviour in Macroeconomics
What causes the booms and recessions that make up the business cycle? Although economists have devoted years of research on this question, there is no consensus on the answer.
A key challenge facing researchers is the complexity of the economic system. Economists rely on theoretical models to help them, but business cycle models, reflecting complex phenomena, are themselves generally complex and often are not fully understood.
Professor Galizia, will use a $32,530 grant for a research project developed to improve our understanding of one of the key features of many existing models: why and where do reasonable individual-level decisions made by economic agents interact in such a way as to produce outcomes that are at odds with those agents’ goals?