We study the causes behind the shift in the level of U.S. GDP following the Great Recession. To this end, we propose a model featuring endogenous productivity à la Romer and a financial friction à la Kiyotaki-Moore. Adverse financial disturbances during the recession and the lack of strong...

We study the causes behind the shift in the level of U.S. GDP following the Great Recession. To this end, we propose a model featuring endogenous productivity à la Romer and a financial friction à la Kiyotaki–Moore. Adverse financial disturbances during the recession and the lack of strong...

This paper constructs a simple endogenous growth model featuring the product cycle, i.e., the transition from monopoly to perfect competition, and studies its implications for both asset market and business cycle statistics. I find that the product cycle is a powerful amplification mechanism;...

Most of the theoretical work in the news shock literature abstracts away from structural explanations, assuming instead that news is a pure signal giving agents advance notice that aggregate technology will undergo exogenous change at some future point. This paper proposes that a surprise...

We study the impact that the liquidity crunch in 2008-2009 had on the U.S. economy's growth trend. To this end, we propose a model featuring endogenous growth ¨¢ la Romer and a liquidity friction ¨¢ la Kiyotaki-Moore. A key finding in our study is that liquidity declined around the demise of...

We study the impact that the liquidity crunch in 2008-2009 had on the U.S. economy’s growth trend. To this end, we propose a model featuring endogenous growth á la Romer and a liquidity friction á la Kiyotaki-Moore. A key finding in our study is that liquidity declined around the demise of...