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An Economical Business-Cycle Model
Saez, Emmanuel; Michaillat, Pascal - National Bureau of Economic Research (NBER) - 2014
In recent decades, advanced economies have experienced low and stable inflation and long periods of liquidity trap. We construct an alternative business-cycle model capturing these two features by adding two assumptions to a money-in-the-utility-function model: the labor market is subject to...
Persistent link: https://www.econbiz.de/10010951069
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The Making Of A Great Contraction With A Liquidity Trap and A Jobless Recovery
Schmitt-Grohé, Stephanie Schmitt-Grohe; Uribe, Martín - National Bureau of Economic Research (NBER) - 2012
The great contraction of 2008 pushed the U.S. economy into a protracted liquidity trap (i.e., a long period with zero nominal interest rates and inflationary expectations below target). In addition, the recovery was jobless (i.e., output growth recovered but unemployment lingered). This paper...
Persistent link: https://www.econbiz.de/10010969402
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The Possible Unemployment Cost of Average Inflation below a Credible Target
Svensson, Lars E.O. - National Bureau of Economic Research (NBER) - 2013
If inflation expectations become firmly anchored at the inflation target even when average inflation deviates from the target, the long-run Phillips curve becomes non-vertical. During 1997-2011, average inflation expectations in Sweden have been close to the inflation target of 2 percent,...
Persistent link: https://www.econbiz.de/10011234893
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Reconstructing Macroeconomic Theory to Manage Economic Policy
Stiglitz, Joseph E. - National Bureau of Economic Research (NBER) - 2014
theory, and behavioral economics. The paper argues that any theory of deep downturns has to answer these questions: What is …
Persistent link: https://www.econbiz.de/10010951037
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Aggregate Demand and Supply
Farmer, Roger E. A. - National Bureau of Economic Research (NBER) - 2007
This paper is part of a broader project that provides a microfoundation to the General Theory of J.M. Keynes. I call … this project 'old Keynesian economics' to distinguish it from new-Keynesian economics, a theory that is based on the idea … definitions of aggregate demand and supply found in the General Theory through the lens of a search theory of the labor market. I …
Persistent link: https://www.econbiz.de/10005084591
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Animal Spirits, Financial Crises and Persistent Unemployment
Farmer, Roger E. A. - National Bureau of Economic Research (NBER) - 2011
economic policies designed to reduce the volatility of asset market movements will significantly increase economic welfare. …
Persistent link: https://www.econbiz.de/10009147529
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Aggregate Demand, Idle Time, and Unemployment
Saez, Emmanuel; Michaillat, Pascal - National Bureau of Economic Research (NBER) - 2013
This paper develops a model of unemployment fluctuations. The model keeps the architecture of the general-disequilibrium model of Barro and Grossman (1971) but takes a matching approach to the labor and product markets instead of a disequilibrium approach. On the product and labor markets, both...
Persistent link: https://www.econbiz.de/10011144242
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Does Labor Supply Matter During a Recession? Evidence from the Seasonal Cycle
Mulligan, Casey - National Bureau of Economic Research (NBER) - 2010
Every year has large demand and supply shifts associated with the seasons, regardless of the phase of the business cycle. Based on measures dating back to the 1940s, the seasonal shifts reject the hypotheses that demand shifts affect employment outcomes significantly more in recession years than...
Persistent link: https://www.econbiz.de/10008565077
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The Heterogeneous State of Modern Macroeconomics: A Reply to Solow
Chari, Varadarajan; Kehoe, Patrick J. - National Bureau of Economic Research (NBER) - 2007
macroeconomics is firmly grounded in economic theory. We disagree and explain why. …
Persistent link: https://www.econbiz.de/10005778451
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Unconventional Fiscal Policy at the Zero Bound
Farhi, Emmanuel; Correia, Isabel; Nicolini, Juan Pablo; … - National Bureau of Economic Research (NBER) - 2011
When the zero lower bound on nominal interest rates binds, monetary policy cannot provide appropriate stimulus. We show that in the standard New Keynesian model, tax policy can deliver such stimulus at no cost and in a time-consistent manner. There is no need to use inefficient policies such as...
Persistent link: https://www.econbiz.de/10008836722