technological diversification. Production makes use of different input varieties, which are subject to imperfectly correlated shocks …. As in endogenous growth models, technological progress increases the number of varieties, raising average productivity …. In our model, the expansion in the number of varieties provides diversification benefits against variety-specific shocks …

relationship between foreign idiosyncratic shocks and domestic economic growth between 1978 and 2000. Contemporaneous changes in … associated with a 0.05-0.26 pp increase in economic growth. Lastly, this can potentially explain the Great Moderation. …

credit risks show a significant impact of the financial sector on the real economy. To promote financial and economic growth … during peak. Enhancing consumption growth stimulates GDP growth in a recession …

-varying levels of volatility and skewness for the same variables; and iii) supercycles of borrowing and deleveraging. All of these …

-varying levels of volatility and skewness for the same variables; and iii) supercycles of borrowing and deleveraging. All of these …

data (Ingram et al., 1994). Model velocity is stable along the balanced growth path, which features endogenous growth and … velocity volatility at both business cycle and long run frequencies. With filtered velocity turning negative, starting during …. -- Volatility ; business cycles ; credit shocks ; velocity …