About

Ludwig Straub is a professor of economics at Harvard University. His research areas are macroeconomics and international economics. Among his topics of interest are the recent decline in the natural rate of interest, rising levels of private and public debt, and the transmission of monetary and fiscal policy. Ludwig also has an active research agenda solving and analyzing heterogeneous-agent models. He obtained his PhD in economics from the Massachusetts Institute of Technology, a master’s degree in mathematics from Trinity College in Cambridge, England, and a bachelor’s degree in physics from Ludwig Maximilians University of Munich. He is the recipient of the 2026 John Bates Clark Medal, the 2024 Sloan Fellowship, and the 2022 AQR Young Researcher Prize.

Research topics

• Economics
• Monetary economics
• Econometrics
• Macroeconomics
• Keynesian economics

Selected publications

• New Keynesian Economics with Household and Firm Heterogeneity

  SSRN Electronic Journal · 2026-01-01

  preprintOpen accessSenior author
  PublisherDOI

• Replication Data for: Determinacy and Large-Scale Solutions in the Sequence Space

  Harvard Dataverse · 2026-01-22

  datasetOpen accessSenior author

  This is the replication package for "Determinacy and Large-Scale Solutions in the Sequence Space," accepted in 2025 by the Journal of Political Economy: Macroeconomics.

  PublisherDOI

• Replication Data for: 'Disaggregated Economic Accounts'

  Open MIND · 2026-01-29

  dataset

  The data and programs replicate tables and figures from "Disaggregated Economic Accounts," by Andersen, Huber, Johannesen, Straub, and Vestergaard. Please see the README file for additional details. The authors have also created a website to aid visualization of the data: https://www.disaggregatedaccounts.com/denmark

  DOI

• New Keynesian Economics with Household and Firm Heterogeneity

  National Bureau of Economic Research · 2025-12-01

  reportOpen accessSenior author
  PublisherDOI

• The Macroeconomics of Tariff Shocks

  SSRN Electronic Journal · 2025-01-01 · 3 citations

  articleOpen accessSenior author
  PublisherDOI

• The Macroeconomics of Tariff Shocks

  National Bureau of Economic Research · 2025-04-01 · 16 citations

  reportOpen accessSenior author

  We study the short-run effects of import tariffs on GDP and the trade balance in an open-economy New Keynesian model with intermediate input trade.We find that temporary tariffs cause a recession whenever the import elasticity is below an openness-weighted average of the export elasticity and the intertemporal substitution elasticity.We argue this condition is likely satisfied in practice because durable goods generate great scope for intertemporal substitution, and because it is easier to lose competitiveness on the global market than to substitute between home and foreign goods.Unilateral tariffs do tend to improve the trade balance, but when other countries retaliate the trade balance worsens and the recession deepens.Taking into account the recessionary effect of tariffs dramatically brings down the optimal unilateral tariff level derived in standard trade theory.

  PublisherDOI

• The Race Between Asset Supply and Asset Demand

  National Bureau of Economic Research · 2025-11-01 · 2 citations

  reportOpen accessSenior author

  We introduce an asset supply-and-demand approach to analyze the trajectory of US aggregate wealth, real interest rates, and fiscal sustainability.Our framework uses micro-founded and easy-toimplement sufficient statistics to quantify how shifts in demographics, inequality, and other forces affect asset market equilibrium.From 1950 to the present, rapid population aging, rising income inequality, increasing foreign demand for US assets, and declining productivity growth all contributed to a surge in asset demand.Asset supply initially fell, then turned around sharply, mainly driven by increases in government debt and the value of capitalized profits.Overall, asset demand won the race, and interest rates fell.Looking ahead to 2100, population aging will continue to strongly push up asset demand, but at current tax and benefit levels, asset supply will win the race, as rising entitlement costs push up government debt even more.While rising asset demand creates space for debt to eventually reach 250% of GDP without higher interest rates, stabilizing debt at any level requires a permanent fiscal adjustment of at least 10% of GDP.

  PublisherDOI

• The Race Between Asset Supply and Asset Demand

  SSRN Electronic Journal · 2025-01-01

  preprintOpen accessSenior author
  PublisherDOI

• Fiscal and Monetary Policy with Heterogeneous Agents

  Annual Review of Economics · 2025-05-07 · 6 citations

  articleOpen accessSenior author

  In the past decade, a new paradigm for fiscal and monetary policy analysis has emerged, combining the canonical macro model of income and wealth inequality with the New Keynesian model. These heterogeneous-agent New Keynesian (HANK) models feature new transmission channels and allow for the joint study of aggregate and distributional effects. We review key developments in this literature through the lens of a canonical HANK model. Monetary and balanced-budget fiscal policy have similar aggregate effects as in the standard New Keynesian model, while deficit-financed fiscal policy is much more expansionary. We discuss the split between direct and indirect effects of policy as well as the implications of cyclical income risk, maturity structure, nominal assets, behavioral frictions, and many other extensions to the model. Throughout, we highlight the benefits of using sequence-space methods to solve and analyze this class of models.

  PublisherDOI

• A Goldilocks Theory of Fiscal Deficits

  American Economic Review · 2025-11-26 · 1 citations

  article

  We develop a tractable framework for deficit and debt dynamics. A “free lunch” fiscal deficit—one that raises spending without higher future taxes—is sustainable without zero lower bound (ZLB) only when R < G − φ, where φ is the sensitivity of the interest rate to the debt level. With the ZLB, both high and low deficits can increase debt, as the latter weaken demand and reduce nominal growth at the ZLB. A rise in income inequality expands fiscal space outside the ZLB, but contracts it at the ZLB. Calibrating the model, we find little space for “free lunch” policies for the United States in 2019, but significant space for Japan. (JEL D31, E23, E43, E62, H62, H63)

  PublisherDOI

Frequent coauthors

• Adrien Auclert

  67 shared

• Matthew Rognlie

  National Bureau of Economic Research

  62 shared

• Martin Souchier

  Harvard University Press

  27 shared

• Iván Werning

  23 shared

• Atif Mian

  Princeton University

  19 shared

• Guido Lorenzoni

  19 shared

• Veronica Guerrieri

  University of Chicago

  19 shared

• Robert Ulbricht

  Boston College

  12 shared