This paper explores the business cycle implications of financial distress and bankruptcy law. We find that due to the presence of financial imperfections the effect of liquidations on the price of capital goods can generate endogenous fluctuations. We show that a law reform that...

We present an empirical analysis of the effects of labour market institutions on the employment dynamics over the cycle. In the first part of the paper a theoretical framework is provided with particular emphasis on working time regulations. The conclusions of the theory are tested in the second...

What is the optimal instrument design and choice for a regular attempting to control emissions by private agents in face of uncertainty arising from business cycles?  In applying Weitzman's result [Prices vs. quantities, Review of Economic Studies, 41 (1974), 477-491] to the problem of...

By generalizing Hamiltons model of the US business cycle to a three-regime Markov-switching vector autoregressive model, this paper analyzes regime shifts in the stochastic process of economic growth in the US, Japan and Europe over the last four decades. Empirical evidence is established for...

This paper proposes a new framework for the impulse-response analysis of business cycle transitions. A cointegrated vector autoregressive Markov-switching model is found to be a congruent representation of post-war US employment and output data. In this model some parameters change according to...

There is a wide literature on the dynamic adjustment of employment and its relationship with the business cycle. Our aim is to propose a statistical model that offers a congruent representation of post-war UK labour market. We use a cointegrated vector autoregressive Markov-switching model where...

This paper extends the REPIH to allow for stochastic shifts in the utility function. The motivation for this is the substantial autonomous fluctuations in UK consumption at the business cycles and seasonal frequencies as well as the influence of demographics on preferences.

We examine whether credit contributes to business cycle fluctuations by dirctly affecting consumption rather than through the new well understood investment channel.