Hammad, Qureshi - In: The B.E. Journal of Macroeconomics 14 (2014) 1, pp. 36-36
The idea that expectations about future economic fundamentals can drive business cycles dates back to the early 20th century. However, the standard real business cycle (RBC) model fails to generate positive comovement in output, consumption, labor-hours and investment in response to news shocks....