The implications of adding household production to an otherwise standard real business cycle model are explored in this article. The model developed treats the business and household sectors symmetrically. In particular, both sectors use capital and labor to produce output. The article finds...

Frontmatter -- CONTENTS -- ILLUSTRATIONS -- TABLES -- PREFACE -- CONTRIBUTORS -- 1. Economic Growth and Business Cycles -- 2. Recursive Methods for Computing Equilibria of Business Cycle Models -- 3. Computing Equilibria of Nonoptimal Economies -- 4. Models with Heterogeneous Agents -- 5....

particular, financial intermediaries can invest resources to monitor the returns earned by firms. The inability to monitor perfectly leads to firms earning rents. Undeserving firms are financed, while deserving ones are under funded. A more efficient monitoring technology squeezes the rents...

Marriage has declined since 1960, with the drop being bigger for non-college educated individuals versus college educated ones. Divorce has increased, more so for the non-college educated vis-à-vis the college educated. Additionally, assortative mating has risen; i.e., people are more likely to...

Societies socialize children about sex. This is done in the presence of peer-group effects, which may encourage undesirable behavior. Parents want the best for their children. Still, they weigh the marginal gains from socializing their children against its costs. Churches and states may...

What determines the choice of technology within a country? While there could be many factors, the efficiency of the country's financial system may play a significant role. To address this question, a dynamic contract model is embedded into a general equilibrium setting with ompetitive...

We propose a rational theory of sexual behavior, where people explicitly take the risk of HIV infection into account. Risky sex has two margins: the use of condoms and engaging in extra-marital affairs. The model exhibits important general equilibrium effects since an increase in the overall...

income and product account data. The welfare gain from the introduction of personal computers is about 4 percent of consumption expenditure.