Showing 41 - 50 of 26,430
This paper unveils how Kydland and Prescott have eliminated the wage rate variable from their labor function to call its fluctuation “real”. The trick is the abuse of constant returns to scale. When all variables of a production function are eliminated this way, the so-called DSGE model is...
Persistent link: https://www.econbiz.de/10013020917
Macroeconomists have emphasized the force of facts in forging a consensus understanding of business cycle fluctuations. According to this view, rival economists could not longer hold disparate views on the topic because "facts have a way of not going away" (Blanchard 2009). But how can...
Persistent link: https://www.econbiz.de/10013024107
This paper studies a labor market search-matching model with multi-worker firms to investigate how firms utilize the extensive and intensive margins over the business cycle. The earnings function derived from the Stole-Zwiebel bargaining acts as an adjustment cost function for employment and...
Persistent link: https://www.econbiz.de/10013024912
There is no such thing as a 'real' economy. The task, therefore, is to consistently reconstruct the fluctuations of employment and output from the interactions of real and nominal variables. The present paper does exactly this. No nonempirical concepts like utility, equilibrium, rationality,...
Persistent link: https://www.econbiz.de/10013036291
We develop a production based asset pricing model with financially constrained firms to explain the observed high asset price volatility. Investment opportunities are scarce and firms face two shocks: classic productivity shocks and financial shocks that affect the tightness of the financial...
Persistent link: https://www.econbiz.de/10013039040
In this paper we want to provide stylized facts about the business cycles in the Philippines using Baxter and King and HP filter. The paper aims to add to the existing literature in characterizing Philippines business cycle, specifically we want to describe not only the characteristic of the...
Persistent link: https://www.econbiz.de/10012914101
This paper empirically investigates the ability of a real business-cycle model with nonseparabilities in consumption and leisure and external habits both in consumption and leisure to fit the postwar US data. The results indicate a strong but fast-dying habit in leisure, and a somewhat weaker...
Persistent link: https://www.econbiz.de/10012906216
We have constructed a RBC model where energy is endogenously minded. It is generated within the model from fossil intermediate and renewable energy resources and consumed by final good production and households. Furthermore, households can invest in a durable good to avoid exaggerated disruptive...
Persistent link: https://www.econbiz.de/10012906392
In a 1957 paper, Robert Solow exploited the mathematical properties of the aggregate production function to isolate the role of disembodied “technical change” in economic growth. Solow's method allowed to disentangle the role of technical change from that of production factors, with the...
Persistent link: https://www.econbiz.de/10012909556
Venezuela has an oil-dependent economy subject to large exogenous shocks and a rigid labor market. These features go straight to the heart of two weaknesses of real business cycle (RBC) theory widely reported in the literature: neither shocks are volatile enough nor real salaries sufficiently...
Persistent link: https://www.econbiz.de/10013240735