An increase in the riskiness of a technology will raise economy-wide expected output: the technology can be used intensively if its productivity realization is large and curtailed otherwise. Some investment in even the riskiest technologies can therefore bring Pareto improvements. The observed...

Although market concentration is one of the main impediments to productivity growth globally, data constraints have limited its analysis to developed countries or cross-country studies based on definitions of market concentration across nations and industries. This paper takes advantage of a...

It is well known that, in continuous time, the Cobb-Douglas function can be derived from the underlying, data governing, accounting identity under some reasonable assumptions (factor shares are constant, and the weighted growth of the labour input price and the capital input price is constant)....

We study the role of firm heterogeneity in affecting business cycle dynamics and optimal stabilization policy. Firms differ in their degree of cyclicality, and hence, exposure to aggregate risk, leading to firm-specific risk premia that influence resource allocations. The heterogeneous firm...