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setting in generating these features.
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Detailed macroeconomic data to accompany the article in the Review of Economic Dynamics
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ABSTRACT Business cycle fluctuations are generally associated with positive co-movement between consumption, investment and employment. In this paper we examine when such positive co-movement can arise in market settings as the result of changes in expectations. We show that most of the standard...
Persistent link: https://www.econbiz.de/10005090930
This paper presents a model of macroeconomic fluctuations driven by agents competing to secure shares in new markets. The resulting fluctuation resemble a gold rush in the sence that they increase economic activity but may be of limited social gain. We use different techniques to evaluate the...
Persistent link: https://www.econbiz.de/10005051206
We present a new propagation mechanism for news shocks in dynamic general equilibrium models. The existing literature has considered representative agents models, in which news shock impact the economy through intertemporal substitution mechanisms. We consider different setups with heterogenous...
Persistent link: https://www.econbiz.de/10011080327
During the last thirty years, US business cycles have been characterized by coun- tercyclical technology shocks and very low inflation variability. While the first fact runs counter to an RBC view of fluctuation and calls for demand shocks as a source of fluctuations, the second fact is...
Persistent link: https://www.econbiz.de/10011081866
There is a widespread belief that changes in expectations may be an important independent driver of economic fluctuations. The news view of business cycles offers a formalization of this perspective. In this paper we discuss mechanisms by which changes in agents' information, due to the arrival...
Persistent link: https://www.econbiz.de/10011081970
The recent financial crisis has highlighted the key role of leveraged financial institutions as liquidity providers. We incorporate leveraged financial institutions into a dynamic general equilibrium portfolio choice model in order to analyze the dynamics of risk, leverage, liquidity and asset...
Persistent link: https://www.econbiz.de/10011080734
In an influential contribution that predates the recent renewed interest in portfolio choice models of international capital flows, Kraay and Ventura (2000) o¤er a "new rule" for the current account that puts portfolio choice at the center of the analysis. The new rule says that in response to...
Persistent link: https://www.econbiz.de/10011080980