Leo Kaas is Professor of Macroeconomics at Goethe University Frankfurt, Germany. He received his doctoral degree at the University of Bielefeld and held faculty positions at the Institute for Advanced Studies, Vienna, at the University of Vienna and at the University of Konstanz. He has also taught at CERGE-EI Prague, CREST Paris, at the University of California, Los Angeles, and at Washington University in St. Louis. His work has been published in theAmerican Economic Review, Journal of Economic Theory, Review of Economic Studies,among other journals. Leo Kaas is an associate editor ofMacroeconomic Dynamics.He joined IZA as a Research Fellow in January 2005.