Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
5062620 | Economics Letters | 2006 | 6 Pages |
Abstract
This paper studies conditions under which demand-side shocks can generate realistic business cycles in RBC models. Although highly persistent demand shocks are necessary for generating procyclical investment, variable capacity utilization and habit formation can reduce the required degree of persistence.
Related Topics
Social Sciences and Humanities
Economics, Econometrics and Finance
Economics and Econometrics
Authors
Yi Wen,