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Keynesian Production Networks and the Covid-19 Crisis : A Simple Benchmark
Baqaee, David; Farhi, Emmanuel - National Bureau of Economic Research - 2021
The Covid-19 crisis is an unusual and seemingly all-encompassing economic shock. On the one hand, it was unquestionably … a negative demand shock that, for fixed prices and incomes, reduced household spending. On the other hand, it was also … unquestionably a negative supply shock that reduced firms' ability to maintain production at pre-pandemic prices and quantities …
Persistent link: https://www.econbiz.de/10012482564
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Two Flaws In Business Cycle Accounting
Christiano, Lawrence J. - 2006
Using 'business cycle accounting' (BCA), Chari, Kehoe and McGrattan (2006) (CKM) conclude that models of financial frictions which create a wedge in the intertemporal Euler equation are not promising avenues for modeling business cycle dynamics. There are two reasons that this conclusion is not...
Persistent link: https://www.econbiz.de/10012466014
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Venting Out : Exports During a Domestic Slump
Almunia, Miguel - 2018
We exploit plausibly exogenous geographical variation in the reduction in domestic demand caused by the Great Recession in Spain to document the existence of a robust, within-firm negative causal relationship between demand-driven changes in domestic sales and export flows. Spanish manufacturing...
Persistent link: https://www.econbiz.de/10012481020
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Trade and the Global Recession
Eaton, Jonathan - 2011
We develop a dynamic multi-country general equilibrium model to investigate forces acting on the global economy during the Great Recession and ensuing recovery. Our multi-sector framework accounts completely for countries' trade, investment, production, and GDPs in terms of different sets of...
Persistent link: https://www.econbiz.de/10012461991
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The Great Trade Collapse
Bems, Rudolfs - 2012
We survey recent literature on the causes of the collapse in international trade during the 2008-2009 global recession. We argue that the evidence points to the collapse in aggregate expenditure, concentrated on trade-intensive durable goods, as the main driver of the trade collapse. Inventory...
Persistent link: https://www.econbiz.de/10012460028
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A Note on Temporary Supply Shocks with Aggregate Demand Inertia
Caballero, Ricardo J.; Simsek, Alp - National Bureau of Economic Research - 2022
We study optimal monetary policy during temporary supply contractions when aggregate demand has inertia and expansionary policy is constrained. In this environment, it is optimal to run the economy hot until supply recovers. Positive output gaps in the low-supply phase lessen the negative output...
Persistent link: https://www.econbiz.de/10013172115
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Are Cyclical Fluctuations in Productivity Due More to Supply Shocks or Demand Shocks?
Shapiro, Matthew D. - 1987
Measured productivity is strongly procyclical. Real business cycle theories suggest that actual fluctuations in productivity are the source of fluctuations in aggregate output. Keynesian theories maintain that fluctuations in aggregate output come from shocks to aggregate demand. Keynesian...
Persistent link: https://www.econbiz.de/10012476922
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A Theory of Housing Demand Shocks
Liu, Zheng - 2019
. The model predicts that a credit supply shock can generate large comovements between the house price and the price …
Persistent link: https://www.econbiz.de/10012479618
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Does a Currency Union Need a Capital Market Union? Risk Sharing via Banks and Markets
Martinez, Joseba - 2019
We compare risk sharing in response to demand and supply shocks in four types of currency unions: segmented markets; a banking union; a capital market union; and complete financial markets. We show that a banking union is efficient at sharing all domestic demand shocks (deleveraging, fiscal...
Persistent link: https://www.econbiz.de/10012479975
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Sticky Information in General Equilibrium
Mankiw, N. Gregory - 2006
This paper develops and analyzes a general-equilibrium model with sticky information. The only rigidity in goods, labor, and financial markets is that agents are inattentive, sporadically updating their information sets, when setting prices, wages, and consumption. After presenting the...
Persistent link: https://www.econbiz.de/10012466056