This paper considers the implications of heterogeneity in information-processing abilities for macroeconomic models that exhibit "strategic complements." The latter is the same concept that has received much attention in the recent macro literature under the headings "Keynesian coordination...

This study measures the heterogeneity of establishment-level employment changes in the U.S. manufacturing sector over the 1972 to 1986 period. The authors measure this heterogeneity in terms of the gross creation and destruction of jobs and the rate at which mobs are reallocated across plants....

This paper develops a model of firm behavior under uncertainty designed to study the interac tion of inventories and layoffs. The model is a blend of a buffer sto ck model of inventory behavior and an implicit contract model of layo ffs. The model creates a distinction between inventory-biased...

"This paper studies capital adjustment at the establishment level. Our goal is to characterize capital adjustment costs, which are important for understanding both the dynamics of aggregate investment and the impact of various policies on capital accu- mulation. Our estimation strategy searches...

"This paper studies the dynamics of portfolio rebalancing and consumption smoothing in the presence of non-convex portfolio adjustment costs. The goal is to understand a household's response to income and return shocks. The model includes the choice of two assets: one riskless without adjustment...