About

Oleg Itskhoki is the Slusky Family Professor of Economics at Harvard University. He has previously held the Venu and Ana Kotamraju Endowed Chair in Economics at the University of California, Los Angeles, and was a Professor of Economics and International Affairs at Princeton University. His research interests are in macroeconomics and international economics, focusing on globalization and labor markets, currencies and exchange rates, and other related topics.

Research topics

• Economics
• Monetary economics
• Labour economics
• Business
• International economics

Selected publications

• Trade Liberalization, Wage Rigidity, and Labor Market Dynamics with Heterogenous Firms

  Mendeley Data · 2026-03-27

  datasetOpen accessSenior author

  Replication package for the published paper in Journal of International Economics.

  PublisherDOI

• Trade Liberalization, Wage Rigidity, and Labor Market Dynamics with Heterogenous Firms

  Mendeley Data · 2026-03-27

  datasetOpen accessSenior author

  Replication package for the published paper in Journal of International Economics.

  PublisherDOI

• Trade liberalization, wage rigidity, and labor market dynamics with heterogeneous firms

  Journal of International Economics · 2026-05-01

  articleSenior authorCorresponding
  PublisherDOI

• Trade Liberalization, Wage Rigidity, and Labor Market Dynamics with Heterogeneous Firms

  SSRN Electronic Journal · 2025-01-01

  preprintOpen access
  PublisherDOI

• Breaking Parity: Equilibrium Exchange Rates and Currency Premia

  SSRN Electronic Journal · 2025-01-01

  articleOpen accessSenior author
  PublisherDOI

• The Optimal Macro Tariff

  National Bureau of Economic Research · 2025-05-01 · 8 citations

  reportOpen access1st authorCorresponding

  What is the optimal macroeconomic tariff when trade is imbalanced and the policy objectives go beyond social welfare and also include fiscal revenues, increasing the number of manufacturing jobs, and closing a trade deficit?We study these questions in an environment which allows for long-run bilateral and aggregate trade deficits that reflect the country's net foreign asset position and differential returns on foreign assets and liabilities (the "exorbitant privilege").Only in special cases does the optimal tariff emerge as an increasing function of a trade deficit and for reasons unrelated to trade competitiveness.Instead, the planner trades off the conventional benefits of improved terms of trade with the costs from negative valuation effects on the country's gross financial position.In our model calibrated to the United States, its large external dollar liabilities reduce the optimal tariff three-fold, from 34% to 9%, and act as an effective hedge for its trade partners against a trade war.In contrast to the expenditure switching logic and Lerner symmetry, closing the trade imbalance calls for an appreciation of the dollar to a level that depends solely on the US external financial position, and not on trade shares or trade elasticities, and can be achieved by means of an import tariff or an export subsidy.Alternatively, financial and trade rebalancing may happen if a tariff war results in the loss of privilege and the associated dollar depreciation.

  PublisherDOI

• The Optimal Macro Tariff

  SSRN Electronic Journal · 2025-01-01

  articleOpen access1st authorCorresponding
  PublisherDOI

• How Good is International Risk Sharing? Stepping Outside the Shadow of the Welfare Theorems

  National Bureau of Economic Research · 2025-12-01

  reportOpen access
  PublisherDOI

• Breaking Parity

  IMF Working Paper · 2025-08-01

  articleOpen accessSenior author

  We offer a unifying empirical model of covered and uncovered currency premia, interest rates and spot and forward exchange rates, both in the cross section and time series of currencies. We find that the rich empirical patterns are in line with a partial equilibrium model of the currency market, where hedged and unhedged currency is supplied by intermediary banks subject to value-at-risk balance-sheet constraints, emphasizing the frictional nature of equilibrium currency premia and exchange rate dynamics. In the cross section, the excess supply of local-currency savings is the key determinant of low relative interest rates, negative covered and uncovered currency premia, cheap forward dollars; and vice versa. In the time series, covered currency premia change infrequently and in concert across currencies, driven by aggregate financial market conditions. In contrast, uncovered currency premia move frequently in response to currency-specific demand shocks, which we capture with the dynamics of net currency futures positions of dealer banks. Sharp exchange rate depreciations in response to negative shifts in currency demand are followed by small persistent predictable appreciations that generate future positive expected currency returns necessary to ensure intermediation of currency demand shocks, irrespective of their financial or macroeconomic origin. Changes in net futures positions of dealer banks account for most of the variation in the spot exchange rate for every currency.

  PublisherDOI

• Sanctions and the Exchange Rate

  The Review of Economic Studies · 2025-09-24 · 1 citations

  articleOpen access1st authorCorresponding

  Abstract Trade wars and financial sanctions are again becoming an increasingly common part of the international economic landscape, and the dynamics of the exchange rate are often used in real time to evaluate the effectiveness of sanctions and policy responses. We show that sanctions limiting a country’s exports or freezing its assets depreciate the exchange rate, while sanctions limiting imports appreciate it, even when both types of policies have exactly the same effect on real allocations, including household welfare and government fiscal revenues. Beyond the direct effect from sanctions, increased precautionary savings in foreign currency also depreciate the exchange rate when they are not offset by the sale of official reserves or financial repression of foreign-currency savings. We show that the dynamics of the ruble exchange rate following Russia’s invasion of Ukraine in February 2022 are quantitatively consistent with the combined effects of these forces calibrated to the observed sanctions and government policies. We evaluate the associated welfare, fiscal and inflationary consequences for both Russia and the coalition of Western countries.

  PublisherOA PDFDOI

Frequent coauthors

• Jozef Konings

  66 shared

• Mary Amiti

  55 shared

• Gita Gopinath

  54 shared

• Benjamin Moll

  53 shared

• Dmitry Mukhin

  51 shared

• Pol Antràs

  Harvard University

  30 shared

• Alonso de Gortari

  Menlo School

  28 shared

• Elhanan Helpman

  26 shared

Education

• B.A., Economics

  Harvard University

  2006

• M.A., Economics

  Harvard University

  2008

• Ph.D., Economics

  Harvard University

  2012

Awards & honors

• 2022 John Bates Clark Medalist
• Sloan Research Fellow
• Excellence Award in Global Economic Affairs from the Kiel In…
• IMF’s list of 25 influential economists under the age of 45