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We develop a model in which innovations in an economy's growth potential are an important driving force of the business cycle. The frame- work shares the emphasis of the recent “new shock” literature on revisions of beliefs about the future as a source of fluctuations, but differs by tieing...
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I develop a multicountry-model in which economic growth is driven mainly by domestic innovation and the adoption of … foreign technologies embodied in traded intermediate goods. Fitting the model to data on innovation, output per capita, and … trade in varieties for the period 1996-2007, I estimate the costs of both domestic innovation and adopting foreign …
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