methodology exploits the information in consumption and net exports to identify the persistence of productivity. We find that …

of markets once we appropriately model the decomposition of underlying productivity shocks into permanent and transitory …

fiscal policy available exacerbates the economic cycle by distorting investment during recessions. We characterize the … mechanism through which limited commitment generates cycles in investment in an environment where under commitment investment … would be constant. We extend our results to standard productivity shocks and to the case where the government has access to …