linearized (or close-to-linear) dynamic stochastic general equilibrium (DSGE) models. Our lack of knowledge also reflects a lack … nonlinear models using aggregate data can be addressed by exploiting estimates of partial-equilibrium responses in disaggregated … data. Microeconomic estimates of the partial-equilibrium causal effects of a policy can discipline the causal channels …

A challenge to models of equilibrium indeterminacy based on increasing returns is that required increasing returns for … sunspot-driven fluctuations can emerge for plausible increasing returns regardless of the relative risk aversion in labor. Our … model generates reasonable dynamics in terms of matching the business cycle, and sunspot shocks become more important with …