Pablo Cuba Borda

Call for papers: Global Research Forum on International Macroeconomics and Finance. Paper submissions due by May 31, 2026: federalreserve.gov/conferences/gl…

New episode! Jesús Fernández-Villaverde on the Quandary of Global Demographic Decline. Watch @JesusFerna7026 and @DavidBeckworth discuss his rise on X, how to frame global demographic decline, the three accelerants of demographic decline, the role of housing in family size, how AI will play a role in global demographics, what we know about AGI, the question of dollar dominance, and much more.

Uber cool 😎

@apmechan @Francesco_Bia Congratulations, Alex!

I'm excited to announce that I will be joining the Johns Hopkins School of Government and Policy as an assistant professor, starting this summer. I am eager to contribute to building a new school devoted to intellectual pluralism, analytical rigor, and institutional reform.

Sage advice! Especially now that we’re all busy implementing the fantastic agentic features in Claude Blattman, thanks @cblatts

Turn it up. That’s the sound of my morning coffee getting an upgrade. @SinceraCoffee bringing that high-altitude Bolivian energy straight to my morning cup. 🇧🇴 ☕️

Come join us in Nashville in April. Submission open until January 31st

Me gusta la estrategia para flexibilizar el tc. Dos observaciones: 1. En adición al precio de referencia diario, ayudaría publicar el volumen de transacciones. 2. Hubiese sido mejor que estas útiles aclaraciones las diera el BCB, no Hacienda.

A guide for students of economics: Ten statements that demonstrate that someone does not understand modern economics or what an equilibrium is, and that you can safely ignore everything else they say. 1. “Equilibrium means the economy is stable or at rest.” Many assume that an equilibrium is a peaceful state with no forces at play. Instead, an equilibrium is just an arrangement of actions and expectations over time that are mutually consistent. It can be locally unstable, explosive, or fragile. Nothing in the definition of equilibrium implies stability. 2. “Equilibrium implies optimality or social efficiency.” Equilibrium is often conflated with efficiency, but equilibrium merely reflects decentralized consistency, not welfare maximization. Market power, externalities, incomplete markets, nominal rigidities, and frictions routinely produce inefficient equilibria. I often teach a first-year macro graduate course, and not a single one of the equilibria I define is efficient. 3. “Equilibrium is a unique outcome.” Many often expect models to have one equilibrium. In reality, multiple equilibria arise naturally in dynamic, strategic, and incomplete-market environments. Models of coordination failures, self-fulfilling expectations, bubbles, overlapping generations, and liquidity traps all hinge on the existence of equilibrium multiplicity. 4. “Equilibrium requires perfect foresight or perfect information.” Equilibrium does not assume agents know the future. In fact, equilibria are often stochastic. The definition of equilibrium only requires that beliefs are consistent with the (perceived) stochastic laws of motion implied by the model. Bayesian learning, noisy signals, ambiguity, and subjective uncertainty all fit well within an equilibrium framework, provided beliefs converge to an internally consistent (but possibly incorrect) distribution. Bonus point: equilibria are compatible with agents having diverging beliefs that never converge to a single Dirac distribution. 5. “Real economies are rarely in equilibrium, so the concept is unrealistic.” Equilibrium is not meant to describe the daily state of the world. It is a conceptual device used to understand the outcome of our models under the assumptions we make. Also, see point 1 above. 6. “Equilibrium requires agents to be fully rational in a psychological sense.” Equilibrium only assumes internal consistency: agents optimize given preferences and constraints. It does not assume realism about human cognition. We can and do define equilibria in models with behavioral biases, bounded rationality, inattention, or rule-of-thumb behavior. We only need to ensure that the resulting actions and beliefs are mutually compatible. 7. “Equilibrium eliminates dynamics or learning.” Equilibrium is sometimes misinterpreted as a static state in which nothing evolves. In fact, many equilibria are sequences of probability distributions over states driven by shocks, policy rules, and endogenous responses. Learning dynamics (Bayesian updating, adaptive rules, experience-based expectations) can occur within equilibrium if the evolution of beliefs is self-consistent. 8. “Equilibrium renders expectations unimportant.” A common misconception is that equilibrium mechanically determines outcomes. In reality, expectations are often central: they determine investment, consumption, asset prices, and policy responses. Many equilibria differ only in their expectations. This is why communication, credibility, and forward guidance matter even in fully rational models. 9. “Equilibrium excludes policy intervention.” Some interpret equilibrium as a laissez-faire concept. In fact, equilibrium analysis is the foundation of modern policy evaluation. Fiscal, monetary, and regulatory interventions work through equilibrium responses (prices, wages, interest rates, quantities) and must satisfy equilibrium conditions to be credible. Equilibrium is a tool for policy design, not a barrier to it. 10. “Equilibriums…” Aequilibrium is a Latin neuter noun of the second declension, which forms a nominative plural in “a”. It is composed of aequus (equal; the same root as equality or equity) and libra (balance or scales or the name of several currencies over history). A final thought: “equilibrium” is a term of art. Its meaning in economics differs from its use in the natural sciences or in everyday language. Terms of art are ubiquitous across academic disciplines, and the first act of intellectual diligence when one starts studying a discipline is to learn what they mean.

@ErnestoPasten2 @bcentralchile Amazing conference, thanks for broadcasting all the sessions.

Honored to have organized with Ricardo Caballero the ARC celebrating the centennial of the @bcentralchile and the day-ahead workshop last week. Thanks to everyone coming and to the Bank for this opportunity. Program, pics and material is/will be here bcentral.cl/en/web/banco-c…

De acuerdo. Oportunidad desaprovechada.

This week I’ll be lecturing at the ECB on deep learning. More than ever, I plan to emphasize the importance of soft inductive bias, double descent, and benign overparameterization—topics I’ve discussed in many previous threads. These three closely related phenomena compel us to reconsider much of what we thought we knew about the model classes used in function approximation and their generalization properties. They also demonstrate why intuition derived from traditional statistics can fail when we transition into the high-dimensional, overparameterized regimes characteristic of modern machine learning. Much of the new material in my lectures comes from a superb recent paper by Andrew Gordon Wilson, Deep Learning is Not So Mysterious or Different. Wilson argues that “rather than restricting the hypothesis space to avoid overfitting, we should embrace a flexible hypothesis space, with a soft preference for simpler solutions that are consistent with the data.” Several aspects of the paper struck me in particular: 1️⃣ The deep links with PAC-Bayes theory, a connection especially relevant to me, given my many papers in Bayesian econometrics. 2️⃣ The insistence that soft inductive bias, double descent, and benign overparameterization are not unique to deep learning but arise in a wide family of model classes. 3️⃣ The move away from attributing the soft inductive bias primarily to optimizers and instead focusing on the structure of the hypothesis space itself. Wilson also discusses mode connectivity, a phenomenon that still puzzles me deeply. I must confess I have almost no intuition for why distinct minima in the loss landscape should be connected by paths of low loss. If anyone has a convincing intuition or geometric explanation, I would be very grateful to hear it. In any case, read the paper—or even better, watch this wonderful interview with the author on Machine Learning Street Talk: 🔗 youtube.com/watch?v=M-jTeB…📷

Every year i wait for this public good to appear

🚨We are hiring at @penn_state! One junior position in an open field. It's been such a great experience working here with fantastic colleagues and supportive environment. Come join us! Apply here: aeaweb.org/joe/listing.ph…

Argentina's President Javier Milei appears to be doubling down on an exchange rate based stabilization program -- an incredibly risky move for a country that blew through $14 billion from the IMF earlier this year to support an overvalued peso. 1/

Ace🎾

Economics Journals as Tennis Tournaments 🧵(for an extremely niche audience) Quarterly Journal of Economics = Wimbledon The oldest and most influential event, but also clubby, snobby, and elitist. To win it you must train on a very particular surface/ZIP code.

Fantastic thread!

Banda cambiaria = 🚩🚩🚩

2 day econ conference = 1 month of coffee consumption ☕️