We analyze the microfoundations for Keynesian aggregate demand effects by considering the link between aggregate demand and firm production decisions under monopolistic competition. Macroeconomic equilibrium is characterized in a simple graphical framework that facilitates comparison of several...

In this paper, we examine the proposition that both the structures of conglomerate firms and their merger activities evidence a systematic attempt to diversify income sources and reduce the volatility of firms' profits. We test whether firms that are active in one line of business are more...

In this paper, we examine the proposition that both the structures of conglomerate firms and their merger activities evidence a systematic attempt to diversify income sources and reduce the volatility of firms' profits. We test whether firms that are active in one line of business are more...

We argue for the adoption of a predictive approach to model specification. Specifically, we derive the difference between means and the ratio of determinants of covariance matrices when a subset of explanatory variables is included or excluded from a regression. Results for an economic...

The paper analyzes the relationship between income shares, wealth and growth in an environment where positional goods are taken into account and rent is generated. This hypothesis, which is a macro engine for inequality, creates a gap between profit share and property share and implies a...

This paper presents a "supermultiplier" model in which the growth of autonomous demand (demand independent of the state of the economy) determines the steady-state growth rate of output. With reasonable parameters, endogenous adjustment of labor supply and productivity causes supply to...

This paper suggests that there are two longstanding views on business cycles and economic dynamics: One emphasizes endogenous stability plus exogenous disturbances, while the other focuses on endogenous instability plus institutional 'containing' or "thwarting" mechanisms. The latter tradition...

An expository paper that points out that there are two long standing views on business cycles and economic dynamics in general, one emphasizing endogenous stability plus exogenous disturbances and the second endogenous instability plus institutional containing or thwarting mechanisms. The...