The Great Moderation in the U.S. economy was accompanied by a widespread increase in the volatility of financial … volatility slowdown in real and nominal variables and in shaping the transmission mechanism of financial shocks. Our model … accounts for the increase in the volatility of financial variables through larger financial shocks, but the vulnerability of …

heterogeneous wage contract between regular and temporary workers on a macroeconomic volatility in a financially fragile economy … cost. As a result of impulse responses to a domestic productivity shock, the higher elasticity of substitution between two …