Employee Profile

Ivan Alfaro

Associate Professor

Department of Finance

Room number B4Y-099
Phone +4746410107
E-mail ivan.alfaro@bi.no

Publications

Shows 2 of 2 publication(s)

Article Iván Alfaro, Hoonsuk Park (2025)

Firm Uncertainty and Households: Spending, Savings, and Risks

Journal of Financial Economics 172 p. 1-15 Doi: https://doi.org/10.1016/j.jfineco.2025.104143

Using daily banking and credit card data for thousands of households linked to U.S. publicly listed employers, we find novel evidence that firm-specific uncertainty persistently reduces future spending and spurs precautionary savings. A one-standard-deviation rise in option-implied firm volatility—akin to the S&P 500 VIX—predicts a $106 monthly spending drop (8 hours of wages) and a $193 increase in bank balances, reflecting notable cutbacks in typical non-durable goods and services. The mechanism operates through heightened household risks: firm uncertainty expands both income and consumption risk over the next year, with the largest effects among lower and top earners (notably the top 1%). Employers only partly shield earnings, while households only partly self-insulate consumption risk via smoothing channels. Detrimental uncertainty effects on households are stronger than firm stock price declines.

Article Iván Alfaro, Nicholas Bloom, Xiaoji Lin (2023)

The Finance Uncertainty Multiplier

Journal of Political Economy 132(2) p. 577-615 Doi: https://doi.org/10.1086/726230

We show how real and financial frictions amplify, prolong and propagate thenegative impact of uncertainty shocks. We first use a novel instrumentation strategy toaddress endogeneity in estimating the impact of uncertainty by exploiting differentialfirm exposure to exchange rate, policy, and energy price volatility in a panel of USfirms. Using common proxies for financial constraints we show that ex-ante financiallyconstrained firms cut their investment even more than unconstrained firms following anuncertainty shock. We then build a general equilibrium heterogeneous firms model withreal and financial frictions, finding financial frictions: i)amplifyuncertainty shocks bydoubling their impact on output; ii) increasepersistenceby extending the duration ofthe drop by 50%; and iii)propagateuncertainty shocks by spreading their impact ontofinancial variables. These results highlight why in periods of greater financial frictionsuncertainty can be particularly damaging.

Shows 5 of 33 publication(s)

Conference lecture Iván Alfaro, Hoonsuk Park (2020)

Academic Degrees
Year	Academic Department	Degree
2017	The Ohio State University, Fisher College of Business	PhD
2007	INCAE Business School	Master of Business Administration
2005	Galileo University	B.S.

Work Experience
Year	Employer	Job Title
2017 - Present	BI Norwegian Business School	Assistant professor

Ivan Alfaro

Publications

Firm Uncertainty and Households: Spending, Savings, and Risks

The Finance Uncertainty Multiplier

Firm Uncertainty and Household Spending

Firm Uncertainty and Household Spending

Firm Uncertainty and Household Spending

The Finance Uncertainty Multiplier

Firm Uncertainty and Household Spending

Firm Uncertainty and Household Spending

Firm Uncertainty and Household Spending

The Finance Uncertainty Multiplier

The Finance Uncertainty Multiplier

The Finance Uncertainty Multiplier

Firm Uncertainty and Household Spending

Firm Uncertainty and Household Spending

Firm Uncertainty and Household Spending

The Finance Uncertainty Multiplier

Firm Uncertainty and Household Spending

The Finance Uncertainty Multiplier

Firm Uncertainty and Household Spending

The Finance Uncertainty Multiplier

Firm Uncertainty and Household Spending

The Finance Uncertainty Multiplier

The Finance Uncertainty Multiplier

The Finance Uncertainty Multiplier

The Finance Uncertainty Multiplier

The Finance Uncertainty Multiplier

The Finance Uncertainty Multiplier

The Finance Uncertainty Multiplier

The Finance Uncertainty Multiplier

The Finance Uncertainty Multiplier

The Finance Uncertainty Multiplier

The Finance Uncertainty Multiplier

The Finance Uncertainty Multiplier

The Finance Uncertainty Multiplier

The Finance Uncertainty Multiplier