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How do firms adjust their output, inventories, employment and capital in response to demandsideshocks? To understand this, we estimate a reduced-form model using firm-level panel dataand we construct a theoretical model that can match the estimated impulse-response functions.A combination of...
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aggregation and empirical misspecification, relying on both theory and empirical evidence. Using data for a stylised aggregate … any total factor productivity measures computed. Our empirical findings imply that sectoral structure is of crucial …
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