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Aggregate Implications of Lumpy Investment: New Evidence and a DSGE Model / Ruediger Bachmann, Ricardo J. Caballero, Eduardo M.R.A. Engel.
- Format:
- Book
- Author/Creator:
- Bachmann, Ruediger.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w12336.
- NBER working paper series no. w12336
- Language:
- English
- Physical Description:
- 1 online resource: illustrations (black and white);
- Other Title:
- Aggregate Implications of Lumpy Investment
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 2006.
- Summary:
- The sensitivity of U.S. aggregate investment to shocks is procyclical: the initial response increases by approximately 50% from the trough to the peak of the business cycle. This feature of the data follows naturally from a DSGE model with lumpy microeconomic capital adjustment. Beyond explaining this specific time variation, our model and evidence provide a counterexample to the claim that microeconomic investment lumpiness is inconsequential for macroeconomic analysis.
- Notes:
- Print version record
- June 2006.
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