Showing 1 - 5 of 5
A major unresolved issue in business cycle theory is the construction of an endogenous propagation mechanism capable of …
Persistent link: https://www.econbiz.de/10012471913
We analyze a financial collapse, such as the one which occurred during the Great Depression, from the perspective of a monetary model with multiple equilibria. The economy we consider contains financial fragility due to increasing returns to scale in the intermediation process. Intermediaries...
Persistent link: https://www.econbiz.de/10012472720
This paper explores cyclical fluctuations in investment due to discrete changes in the plant's stock of capital. To do so, we focus on a machine replacement problem in which a producer decides whether to replace its entire existing stock of capital with new machinery and equipment. This decision...
Persistent link: https://www.econbiz.de/10012473615
We study the stochastic behavior of a dynamic general equilibrium model with monopolistic competition. Each seller sells his product in the consumption goods as well as the investment goods market and has market power in both. Consumers derive utility from a CES aggregate of all the consumption...
Persistent link: https://www.econbiz.de/10012474378
This paper studies an economy in which producers must incur resource costs to replace depreciated machines. The process of costly replacement and depreciation creates endogenous fluctuations in productivity, employment and output of a single producer. We also explore the spillover effects of...
Persistent link: https://www.econbiz.de/10012475492