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Intermediate Goods and Business Cycles : Implications for Productivity and Welfare
Basu, Susanto - 2010
, state- dependent price rigidity. True technical efficiency is procyclical even though production takes place with constant …
Persistent link: https://www.econbiz.de/10013138620
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Dynamic General Equilibrium Models with Imperfectly Competitive Product Markets
Rotemberg, Julio J.; Woodford, Michael - 2021
This paper discusses the consequences of introducing imperfectly competitive product markets into an otherwise standard neoclassical growth model. We pay particular attention to the consequences of imperfect competition for the explanation of fluctuations in aggregate economic activity. Market...
Persistent link: https://www.econbiz.de/10013232158
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Closed and Open Economy Models of Business Cycles with Marked Up and Sticky Prices
Barro, Robert J.; Tenreyro, Silvana - 2021
model in which markup ratios correspond to the prices of differentiated intermediate inputs relative to the price of … reduces the relative price of intermediates and thereby mimics the output effects from an increase in competition. In an open … economy, domestic output is stimulated by reductions in the relative price of foreign intermediates and, therefore, by …
Persistent link: https://www.econbiz.de/10013310232
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Market Liquidity -- Theory and Empirical Evidence
Vayanos, Dimitri - 2012
In this paper we survey the theoretical and empirical literature on market liquidity. We organize both literatures around three basic questions: (a) how to measure illiquidity, (b) how illiquidity relates to underlying market imperfections and other asset characteristics, and (c) how illiquidity...
Persistent link: https://www.econbiz.de/10013103064
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Theory and Empirical Work on Imperfectly Competitive Markets
Pakes, Ariel - 2010
This paper reviews recent methodological developments in the empirical analysis of imperfectly competitive markets highlighting outstanding problems. Some of these problems are econometric; e.g. the need for a deeper understanding of the small sample properties of our estimators. Most of the...
Persistent link: https://www.econbiz.de/10012759183
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Putting the Cycle Back into Business Cycle Analysis
Beaudry, Paul - 2016
This paper begins by re-examining the spectral properties of several cyclically sensitive variables such as hours worked, unemployment and capacity utilization. For each of these series, we document the presence of an important peak in the spectral density at a periodicity of approximately 36-40...
Persistent link: https://www.econbiz.de/10012979357
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Business Cycles, Investment Shocks, and the "Barro-King" Curse
Ascari, Guido - 2017
Recent empirical evidence identifies investment shocks as key driving forces behind business cycle fluctuations. However, existing New Keynesian models emphasizing these shocks counterfactually imply a negative unconditional correlation between consumption growth and investment growth, a weak...
Persistent link: https://www.econbiz.de/10012966936
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Ambiguous Business Cycles
Ilut, Cosmin L. - 2012
This paper considers business cycle models with agents who dislike both risk and ambiguity (Knightian uncertainty). Ambiguity aversion is described by recursive multiple priors preferences that capture agents' lack of confidence in probability assessments. While modeling changes in risk...
Persistent link: https://www.econbiz.de/10013109445
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Monetary Policy, Bounded Rationality, and Incomplete Markets
Farhi, Emmanuel - 2017
This paper extends the benchmark New-Keynesian model by introducing two frictions: (1) agent heterogeneity with incomplete markets, uninsurable idiosyncratic risk, and occasionally binding borrowing constraints; and (2) bounded rationality in the form of level-k thinking. Compared to the...
Persistent link: https://www.econbiz.de/10012960160
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Financial Market Imperfections and Business Cycles
Greenwald, Bruce C. N. - 2008
This paper develops a simple model of macroeconomic behavior which incorporates the impact of financial market quot;imperfections,quot; such as those generated by asymmetric information in financial markets. These information asymmetries may lead to breakdowns in markets, like that for equity,...
Persistent link: https://www.econbiz.de/10012774730