It is well known from time series analysis that shocks to aggregate output have very persistent effects. This paper argues that the relation between the expected growth rate of a firm and its size\ provides a microfoundation for such aggregate persistence. The empirical evidence indicates that...

Unit roots in output, an exponential 2% rate of convergence and no change in the underlying dynamics of output seem to be three stylized facts that can not go together. This paper extends the Solow-Swan growth model allowing for cross-sectional heterogeneity. In this framework, aggregate shocks...

We claim that the stock market encourages business creation, innovation, and growth by allowing the recycling of "informed capital". Due to incentive and information problems, new start-ups face high flotation costs. Sustaining a tight relationship with a monitor allows them to postpone their...

Spain has had a serious structural unemployment problem for the last 20 years. This paper argues that the interaction of /ring costs and job-to-job 0ows added to changes in unemployment bene/ts, could provide an explanation for equilibrium unemployment increasing, since 1984. First, we construct...

Unit roots in output, an exponential 2 per cent rate of convergence and no change in the underlying dynamics of output seem to be three stylized facts that cannot go together. This paper extends the Solow-Swan growth model allowing for cross-sectional heterogeneity. In this framework, aggregate...

We explore the business-cycle implications of agency problems between firms and financiers. We show how these problems create liquidity shortages that can lead to corporate bankruptcy, and may generate aggregate, endogenous cycles in an economy that otherwise would have had a unique, stationary...

We study the properties of mimicking portfolios in an intertemporal APT model, in which the conditional mean and covariance matrix of returns vary in an interdependent manner. We use a signal extraction approach, and relate the efficiency of (possibly) dynamic basis portfolios to mean square...

Poland's current challenge is to somplete its transition to a fully developed market economy, while advancing towards integration into the European Union. This paper is devoted to analyzing the Polish labor market's main institutions, circa 1995, in the areas of labor reallocation, wage setting,...