Showing 1 - 10 of 48
In this paper, we test whether labor-hoarding environments with basic and augmented laws of motion provide an adequate explanation for observed business cycle dynamics. The basic law of motion assumes that the information set used by economic agents to forecast future forcing variables includes...
Persistent link: https://www.econbiz.de/10005572491
We perform an empirical evaluation of the role of capacity utilization in business cycle fluctuations. We first document the relation between capacity utilization and business cycle fluctuations in historical data and then verify whether these empirical features can be explained by a dynamic...
Persistent link: https://www.econbiz.de/10005611952
This paper studies a credit crunch in a dynamic general equilibrium model economy with numerous and heterogeneous investment projects. Banks provide loans to endogenously arising entrepreneurs and deposit to the rest of the population. The credit crunch is caused by conservative lending policies...
Persistent link: https://www.econbiz.de/10005611961
In this paper, we introduce a dynamic general equilibrium model with numerous and heterogeneous investment projects and endogenous occupational choice to study a credit crunch. The investment decision is determined through the occupational choice of households which is driven by the endogenous...
Persistent link: https://www.econbiz.de/10005827161
Japan has gone through a long period of stagnation in the 1990s. We use a model of financial intermediation and endogenous occupational choice to understand this stagnation. In this model, investment projects are partly financed by loans and banks screen candidates by looking at their wealth....
Persistent link: https://www.econbiz.de/10005168690
Empirical studies reveal that monetary policy shocks generate long-lasting effects on real GDP, countercyclical real wages before World War II and procyclical real wages afterwards. In this paper, we construct a dynamic general equilibrium model to explain the observed output persistence and the...
Persistent link: https://www.econbiz.de/10005572469
Multi-country models have not been very successful in replicating important features of the international transmission of business cycles. This paper extends previous work by introducing multiple sectors and traded intermediate inputs. Trade in intermediate goods represents approximately 60% of...
Persistent link: https://www.econbiz.de/10005572470
Using aggregate US and Canadian data, this paper examines the implications for the empirical assessment of market structure and exogeneity of productivity shocks of correcting the Solow residual for variation in capacity utilization. In contrast to most studies, not accounting for capacity...
Persistent link: https://www.econbiz.de/10005572474
We analyze a stochastic general equilibrium model which incorporates three different types of government expenditure. We calibrate the model and simulate it under the hypotheses of divisible and indivisible labor supply. Our results indicate that the addition of government expenditure shocks to...
Persistent link: https://www.econbiz.de/10005572480
We estimate an optimization-based model with sticky prices alone (SP model) and one that combines nominal and real rigidities in the form of costly price and labor adjustments (NRR model) over the U.S. postwar time period. We then compare their ability to generate persistent, positive, responses...
Persistent link: https://www.econbiz.de/10005572481