We thank Casey Mulligan, Eduardo Dávila, Axelle Ferriere, Harald Uhlig, Nicolas Werquin, and especially Guido Lorenzoni and Elisa Rubbo, as well as participants at various conferences for discussions and comments, and Leo Aparisi De Lannoy, Jiawei Fan and Karan Jain for excellent research assistance. Bhandari, Evans, and Golosov thank the NSF for support (grant #36354.00.00.00).