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Learning from Prices : Amplification and Business Fluctuations
Chahrour, Ryan - 2017
alters the effects of aggregate shocks. Learning from prices causes changes in aggregate productivity to shift aggregate … arbitrarily small productivity shocks lead to substantial fluctuations. Augmented with a public signal, the model can generate a … rich mix of supply- and demand-driven fluctuations even though productivity is the only source of aggregate randomness. Our …
Persistent link: https://www.econbiz.de/10012956266
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CBDC and Business Cycle Dynamics in a New Monetarist New Keynesian Model
Assenmacher-Wesche, Katrin; Bitter, Lea; Ristiniemi, Annukka - 2023
To study implications of an interest-bearing CBDC on the economy, we integrate a New Monetarist-type decentralised market that explicitly accounts for the means-of-exchange function of bank deposits and CBDC into a New Keynesian model with financial frictions. The central bank influences the...
Persistent link: https://www.econbiz.de/10014354929
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Business Cycle Dynamics Under Rational Inattention
Maćkowiak, Bartosz - 2011
We develop a dynamic stochastic general equilibrium model with rational inattention by households and firms. Consumption responds slowly to interest rate changes because households decide to pay little attention to the real interest rate. Prices respond quickly to some shocks and slowly to other...
Persistent link: https://www.econbiz.de/10013127486
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Endogenous TFP, Business Cycle Persistence and the Productivity Slowdown in the Euro Area
Spitzer, Martin - 2020
generating the pre-crisis productivity slowdown, while starting from the Great Recession a shock to liquidity demand is …This paper analyses the endogeneity of euro area total factor productivity and its role in business cycle amplification … by estimating a medium-scale DSGE model with endogenous productivity mechanism on euro area data. In this framework …
Persistent link: https://www.econbiz.de/10012834776
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Rational Inattention and the Business Cycle Effects of Productivity and News Shocks
Maćkowiak, Bartosz; Wiederholt, Mirko - 2023
news about future productivity. By contrast, the baseline RBC model produces neither persistent growth rates nor business …
Persistent link: https://www.econbiz.de/10014353582
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Animal Spirits, Fundamental Factors and Business Cycle Fluctuations
Dées, Stéphane - 2016
This paper explores empirically the role of noisy information in cyclical developments and aims at separating fluctuations that are due to genuine changes in fundamentals from those due to temporary animal spirits or expectational errors (noise shocks). Exploiting the fact that the...
Persistent link: https://www.econbiz.de/10012983085
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Stock Price Cycles and Business Cycles
Adam, Klaus; Merkel, Sebastian - 2021
We present a simple model that quantitatively replicates the behavior of stock prices and business cycles in the United States. The business cycle model is standard, except that it features extrapolative belief formation in the stock market, in line with the available survey evidence....
Persistent link: https://www.econbiz.de/10013315341
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What Drives Business Cycles and International Trade in Emerging Market Economies?
Sanchez, Marcelo - 2007
This paper investigates the role of domestic and external factors in explaining business cycle and international trade developments in fifteen emerging market economies. Results from sign restricted VARs show that developments in real output, inflation, real exchange rates and international...
Persistent link: https://www.econbiz.de/10012777677
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Signals from the Government : Policy Disagreement and the Transmission of Fiscal Shocks
Callegari, Giovanni - 2016
We investigate the effects of fiscal policy communication on the propagation of government spending shocks. To this aim, we propose a new index measuring the coordination effects of policy communication on private agents' expectations. This index is based on the disagreement amongst US...
Persistent link: https://www.econbiz.de/10012982912
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Flight to Liquidity and the Great Recession
Radde, Sören - 2014
liquidity, which strongly amplifies the initial shock and induces credit crunch dynamics sharing key features with the Great … Recession. The paper thus develops a new balance sheet channel of shock transmission that works through the composition of banks …
Persistent link: https://www.econbiz.de/10013048760