volatility and economic activity assuming that both variables are driven by the same set of unobserved common factors and that … these factors affect volatility and economic activity with a time lag of at least a quarter. Under these assumptions, the … driven by the common factors. The evidence is interpreted as suggesting that volatility is a symptom rather than a cause of …

constrained firms are found across the entire firm size distribution, even in the top 1%. Incorporating a richer, empirically … supported, productivity process into a standard heterogeneous firms model generates a joint distribution of size and credit …