Methods versus Substance: Measuring the Effects of Technology Shocks on Hours / José-Víctor Ríos-Rull, Frank Schorfheide, Cristina Fuentes-Albero, Maxym Kryshko, Raül Santaeulàlia-Llopis.

Format:

Book

Author/Creator:

Ríos-Rull, José-Víctor.

Contributor:

National Bureau of Economic Research.

Schorfheide, Frank.

Fuentes-Albero, Cristina.

Kryshko, Maxym.

Santaeulàlia-Llopis, Raül.

Series:

Working Paper Series (National Bureau of Economic Research) no. w15375.

NBER working paper series no. w15375

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Other Title:

Methods versus Substance

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 2009.

Summary:

In this paper, we employ both calibration and modern (Bayesian) estimation methods to assess the role of neutral and investment-specific technology shocks in generating fluctuations in hours. Using a neoclassical stochastic growth model, we show how answers are shaped by the identification strategies and not by the statistical approaches. The crucial parameter is the labor supply elasticity. Both a calibration procedure that uses modern assessments of the Frisch elasticity and the estimation procedures result in technology shocks accounting for 2% to 9% of the variation in hours worked in the data. We infer that we should be talking more about identification and less about the choice of particular quantitative approaches.

Notes:

Print version record

September 2009.