The Real Business Cycle (RBC) research program has grown specularly over the last decade, as its concepts and methods have diffused into mainstream macroeconomics. Yet, there is increasing skepticism that technology shocks are a major source of business fluctuations. This chapter exposits the...

The labor search and matching model plays a growing role in macroeconomic analysis. This paper provides a critical, selective survey of the literature. Four fundamental questions are explored: how are unemployment, job vacancies, and employment determined as equilibrium phenomena? What...

This working paper describes two well-known approaches to finding an approximate solution to a real business cycle model: solving a linear-quadratic approximation to a social planning problem; and solving a linearized version of the equilibrium conditions of the model.

We survey the existing work on the cross-country differences in the transmission of European monetary policy. We find that prior work, focusing on macroeconomic data, does not clearly answer the question posed in the title and offer some explanations for the ambiguity.

This paper investigates the effects of introducing imperfect competition in an international business cycle model. We provide some international evidence on markups and analyze the implicactions of increasing returns to scale and monopolistic competition for the effects and the international...

One of the main topics of macroeconomics analysis is to assess the causes and transmission of business cycles. In order to address this issue, macroeconomists have analysed the response of output to different types of shocks. However, since a shock is by definition an unobserved variable, there...

The Real Business Cycle (RBC) research program has grown spectacularly over the last decade, as its concepts and methods have diffused into mainstream macroeconomics. Yet, there is increasing skepticism that technology shocks are a major source of business fluctuations. This chapter exposits the...

This article provides an interpretative overview of the papers in this special issue of JIMF devoted to international aspects of the 2007–2009 financial crisis. It then goes on to provide additional empirical evidence of two sorts. The first documents the difference between the monetary...

ours worked by individuals with a college degree (skilled workers) since the mid-1980’s. Using the CPS outgoing rotation data set for the period 1979:1-2003:4, we find that the volatility of aggregate skilled hours relative to the volatility of GDP has nearly tripled since 1984. In contrast,...

An analysis of the disease of formalism in modern economics. Its manifestation in general equilibrium theory, game theory, the new classical macroeconomics and real business cycle theory. Symptoms of the disease in the current vogue for postmodernism in methodololy. The possibilities for curing...