Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
5098615 | Journal of Economic Dynamics and Control | 2014 | 14 Pages |
Abstract
This paper develops and estimates a stochastic general equilibrium model with capital maintenance, which affects endogenously the depreciation rate of capital. The estimate of maintenance series is found to track survey-based measures for Canada quite closely and to generate the procyclical pattern of maintenance observed in the data. We use our model estimates to infer the time profile of equipment capital depreciation in Canadian and US manufacturing. The depreciation rate is estimated to be volatile and highly procyclical in both countries.
Related Topics
Physical Sciences and Engineering
Mathematics
Control and Optimization
Authors
Alice Albonico, Sarantis Kalyvitis, Evi Pappa,