Showing papers by "Francisco J. Buera published in 2018"
TL;DR: In this paper, the authors review new theories of learning that posit specific, distinct roles for the learner or innovator and their intellectual environment and consider applications to the dynamics of individual earnin...
Abstract: We review new theories of learning that posit specific, distinct roles for the learner or innovator and their intellectual environment. We consider applications to the dynamics of individual earnin...
18 citations
TL;DR: In this paper, a quantitative model of firm dynamics with endogenous innovation is proposed to study growth acceleration episodes triggered by reforms, and the authors find that reforms removing barriers to firm entry lead to persistent growth in TFP and declining average firm size.
Abstract: This paper proposes a quantitative model of firm dynamics with endogenous innovation to study growth acceleration episodes triggered by reforms. The authors find that reforms removing barriers to firm entry lead to persistent growth in TFP and declining average firm size, as in the experience of successful post-communist transitions. Reforms that reverse resource misallocation result in more protracted paths of TFP and rising average firm size, as in the experience of non-communist growth accelerations. When calibrating the reforms to data from Chile's and China’s growth accelerations, the model can replicate the macro and firm-level features of these episodes.
15 citations
Posted Content•
TL;DR: This article used micro data from Portugal during the sovereign debt crisis, starting in 2010, and found that highly leveraged firms and firms that had a larger share of short-term debt on their balance sheets contracted more in the aftermath of a financial shock.
Abstract: What are the heterogeneous effects of financial shocks on firms' behavior? This paper evaluates and answers this question from both an empirical and a theoretical perspective. Using micro data from Portugal during the sovereign debt crisis, starting in 2010, we document that highly leveraged firms and firms that had a larger share of short-term debt on their balance sheets contracted more in the aftermath of a financial shock. We use a standard model to analyze the conditions under which leverage and debt maturity determine the sensitivity of firms' investment decisions to financial shocks. We show that the presence of long-term investment projects and frictions to the issuance of long-term debt are needed for the model to rationalize the empirical findings. We conclude that the differential responses of firms to a financial shock do not provide unambiguous information to identify these shocks. Rather, we argue that this information should be use to test for the relevance of important model assumptions.
3 citations
Posted Content•
TL;DR: In this article, a quantitative model of firm dynamics with endogenous innovation is proposed to study growth acceleration episodes triggered by reforms, and the authors find that reforms removing barriers to firm entry lead to persistent growth in TFP and declining average firm size.
Abstract: This paper proposes a quantitative model of firm dynamics with endogenous innovation to study growth acceleration episodes triggered by reforms. The authors find that reforms removing barriers to firm entry lead to persistent growth in TFP and declining average firm size, as in the experience of successful post-communist transitions. Reforms that reverse resource misallocation result in more protracted paths of TFP and rising average firm size, as in the experience of non-communist growth accelerations. When calibrating the reforms to data from Chile's and China?s growth accelerations, the model can replicate the macro and firm-level features of these episodes.
1 citations
Posted Content•
01 Jan 2018
TL;DR: This paper developed a generalized model of structural change that jointly considers the demand and production sides to answer these questions, and estimated the model using data on sectoral value-added, capital and labor allocations, price indexes, and income per capita in a large panel of 39 countries.
Abstract: Can the changes in the structure of consumption and production be described by a stable and parsimoneous model? Are there important deviations from these benchmark trends for subsets of countries and periods? We develop a generalized model of structural change that jointly considers the demand and production sides to answer these questions. Production is generalized to allow for time-varying factor shares and rich productivity dynamics. Demand is generalized to allow for persistent non-homotheticities and independent price elasticities. We estimate the model using data on sectoral value-added, capital and labor allocations, price indexes, and income per capita in a large panel of 39 countries.
1 citations