There is a large body of research investigating the impact of information and communication technologies (ICT) on economic growth; however, the empirical evidence on growth and its volatility simultaneously driven by ICT diffusion has still remained scarce so far. To fill this void, system...

I study the effects of uncertainty on technology adoption and thereby on volatility and growth. I present an analytically-tractable model in which: (i) uncertainty about the returns to adoption delays technology diffusion; and (ii) the mean and volatility of output growth are jointly determined...

We prove that the diffusion limit of Real-Time GARCH (RT-GARCH) exists if we introduce an auxiliary process to replace the squared return in the volatility process. The volatility of the diffusion follows an Ornstein-Uhlenbeck-type process which fails to be positive with probability one unless...