We analyze post 1991 liberalization Indian economy using the Monetary Business Cycle Accounting framework. We use quarterly National Accounts data from 1996.Q1-2017.Q4, and we find that efficiency wedges explain up to 68% of fluctuations in output and 40% of hours worked, while investment wedges...

We study the monetary policy transmission or lack of it in Indian context using a Monetary Business Cycle Accounting (MBCA) framework. The standard MBCA setup consists of a real business cycle model with a central bank following Taylor’s rule augmented with wedges which capture the deviation...

We study the volatility of growth rates and find that it differs systematically across countries. Our empirical investigation reveals that there is a high correlation between disparity in political regimes across countries and differences in volatility. This is not the case for some of the...

There is a growing literature that studies the properties of models that combine international trade and neoclassical growth theory, but mostly in a de- terministic setting. In this paper we introduce uncertainty in a dynamic Heckscher-Ohlin model and characterize the equilibrium of a small open...

There is a growing literature that studies the properties of models that combine international trade and neoclassical growth theory, but mostly in a deterministic setting. In this paper we introduce uncertainty in a dynamic Heckscher-Ohlin model and characterize the equilibrium of a small open...

Our empirical investigation reveals that less democratic countries have higher volatility of GDP growth rates. Disparity in polity across countries robustly dominates differences in initial income, inequality or instability of regimes, the commonly cited reasons in the literature, as the main...

The empirical relationship between the average growth rate and the volatility of growth rates, both over time and across countries, has important policy implications, which depend critically on the sign of the relationship. Following Ramey and Ramey (1995), a wide consensus has been building...

The authors characterize the equilibrium for a small economy in a dynamic Heckscher-Ohlin model with uncertainty. They show that, when trade is balanced period-by-period, the per capita output and consumption of a small open economy converge to an invariant distribution that is independent of...

We study the volatility of growth rates and find that it differs systematically across countries. Our empirical investigation reveals that there is a high correlation between disparity in political regimes across countries and differences in volatility. This is not the case for some of the...