Chaos, sunspots and automatic stabilizers
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In this article, the authors consider a real business cycle model with an externality in production and identify an automatic stabilizer income tax-subsidy schedule with two properties: (i) it specifies the tax rate to be an increasing function of aggregate employment, and (ii) earnings are subsidized when aggregate employment is at its efficient level.About:
This article is published in Journal of Monetary Economics.The article was published on 1999-08-01 and is currently open access. It has received 160 citations till now. The article focuses on the topics: Automatic stabilizer & Tax rate.read more
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Testing for Indeterminacy: An Application to U.S. Monetary Policy: Reply
TL;DR: In this article, the authors considered a prototypical New Keynesian model, in which the equilibrium is undetermined if monetary policy is "passive" and extended the likelihood-based estimation of dynamic equilibrium models to allow for indeterminacies and sunspot fluctuations.
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From Great Depression to Great Credit Crisis: Similarities, Differences and Lessons
Miguel Almunia,Agustín S. Bénétrix,Barry Eichengreen,Kevin H. O'Rourke,Kevin H. O'Rourke,Kevin H. O'Rourke,Gisela Rua +6 more
TL;DR: Almunia et al. as discussed by the authors analyzed monetary and fiscal responses in the 1930s as a natural experiment or counterfactual capable of shedding light on the impact of current policies.
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Rethinking macroeconomics: what failed, and how to repair it
TL;DR: In this paper, the authors argue that the standard macroeconomic models have failed, by all the most important tests of scientific theory, and that there have been systemic changes to the structure of the economy that made the economy more vulnerable to crisis, contrary to what the standard models argued.
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The role of automatic stabilizers in the U.S. business cycle
Alisdair McKay,Ricardo Reis +1 more
TL;DR: In this article, the authors identify seven potential stabilizers in the data and include four theoretical channels through which they may operate in a business cycle model calibrated to the U.S. data.
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Capacity Utilization under Increasing Returns to Scale
TL;DR: The authors showed that the propagation mechanism generated by capacity utilization under mild increasing returns is capable of explaining the periodic patterns of U.S. business cycles documented by Watson, and overcomes an important objection against the empirical relevance of the Benhabib-Farmer model as a potential account of actual business cycle fluctuations.
References
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A New Approach to the Economic Analysis of Nonstationary Time Series and the Business Cycle.
TL;DR: In this article, the parameters of an autoregression are viewed as the outcome of a discrete-state Markov process, and an algorithm for drawing such probabilistic inference in the form of a nonlinear iterative filter is presented.
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Bank Runs, Deposit Insurance, and Liquidity
TL;DR: The authors showed that bank deposit contracts can provide allocations superior to those of exchange markets, offering an explanation of how banks subject to runs can attract deposits, and showed that there are circumstances when government provision of deposit insurance can produce superior contracts.
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Large Shareholders and Corporate Control
Andrei Shleifer,Robert W. Vishny +1 more
TL;DR: In this article, the authors explore a model in which the presence of a large minority shareholder provides a partial solution to the free-rider problem in a corporation with many small owners, where the corporation may not pay any one of them to monitor the performance of the management.
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Postwar U.S. Business Cycles: An Empirical Investigation
TL;DR: In this article, a procedure for representing a times series as the sum of a smoothly varying trend component and a cyclical component is proposed, and the nature of the comovements of the cyclical components of a variety of macroeconomic time series is documented.
Book
Recursive methods in economic dynamics
TL;DR: In this article, a deterministic model of optimal growth is proposed, and a stochastic model is proposed for optimal growth with linear utility and linear systems and linear approximations.