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Baqaee, David; Rubbo, Elisa - National Bureau of Economic Research - 2022

This paper reviews a framework for studying the aggregation and propagation of microeconomic shocks in general equilibrium. We discuss the determinants of aggregate measures of real economic activity, like real GDP, real domestic absorption, and aggregate productivity in both efficient and...

Persistent link: https://www.econbiz.de/10013435100

Pricing Assets in an Economy with Two Types of People

Farmer, Roger E.A. - 2016

This paper constructs a general equilibrium model with two types of people where asset price fluctuations are caused by random shocks to the price level that reallocate consumption across generations. In this model, asset prices are volatile, and price-earnings ratios are persistent, even though...

Persistent link: https://www.econbiz.de/10012456447

Uncertainty Shocks in a Model of Effective Demand

Basu, Susanto - 2012

shock in the data causes significant declines in output, consumption, investment, and hours worked. Standard general … usual stabilizing function because of the zero lower bound. We calibrate our uncertainty shock process using fluctuations in …

Persistent link: https://www.econbiz.de/10012460240

Price Setting with menu cost for Multi-product firms

Alvarez, Fernando E. - 2012

impulse response of aggregate prices and output to a monetary shock. The size of the output response and its duration increase …

Persistent link: https://www.econbiz.de/10012460733

A Three State Model of Worker Flows in General Equilibrium

Krusell, Per - 2009

We develop a simple model featuring search frictions and a nondegenerate labor supply decision along the extensive margin. The model is a standard version of the neoclassical growth model with indivisible labor with idiosyncratic shocks and frictions characterized by employment loss and...

Persistent link: https://www.econbiz.de/10012463398

Idiosyncratic Shocks and the Role of Nonconvexities in Plant and Aggregate Investment Dynamics

Khan, Aubhik - 2007

We study a model of lumpy investment wherein establishments face persistent shocks to common and plant-specific productivity, and nonconvex adjustment costs lead them to pursue generalized (S,s) investment rules. We allow persistent heterogeneity in both capital and total factor productivity...

Persistent link: https://www.econbiz.de/10012465811

Deflationary Shocks and Monetary Rules : an Open-Economy Scenario Analysis

Laxton, Douglas - 2006

The paper considers the macroeconomic transmission of demand and supply shocks in an open economy under alternative assumptions on whether the zero interest floor (ZIF) is binding. It uses a two-country general-equilibrium simulation model calibrated to the Japanese economy vis-a-vis the rest of...

Persistent link: https://www.econbiz.de/10012465957

Monetary Shocks and Real Exchange Rates in Sticky Price Models of International Business Cycles

Chari, V. V. - 1997

The data show large and persistent deviations of real exchange rates from purchasing power parity. Recent work has shown that to a large extent these movements are driven by deviations from the law of one price for traded goods. In the data, real and nominal exchange rates are about 6 times as...

Persistent link: https://www.econbiz.de/10012472952

Evaluating Labour Adjustment Costs from Trade Shocks : Illustrations for the U.S. Economy Using an Applied General Equilibrium Model With Transactions

Clarete, Ramon L. - 1994

This paper presents a general equilibrium approach to calculating labour adjustment costs induced by trade policy changes or external sector shocks, which we illustrate by analyzing the adjustment consequences of eliminating quotas and tariffs on U.S. imports. In our approach, factor adjustments...

Persistent link: https://www.econbiz.de/10012474306

Spatial Linkages, Global Shocks, and Local Labor Markets : Theory and Evidence

Adão, Rodrigo - 2019

flexible structure of spatial linkages, we characterize the model-consistent shock exposure of a local market as the exogenous … directly to the market's own shock exposure, and indirectly to other markets shocks exposures. We show how spatial linkages …-in-difference designs based on model-consistent measures of local shock exposure approximate well the differential effect of international …

Persistent link: https://www.econbiz.de/10012479498