Building Blocks of Market Clearing Business Cycle Models / Kevin M. Murphy, Andrei Shleifer, Robert W. Vishny.

Format:

Book

Author/Creator:

Murphy, Kevin M.

Contributor:

National Bureau of Economic Research.

Shleifer, Andrei.

Vishny, Robert W.

Series:

Working Paper Series (National Bureau of Economic Research) no. w3004.

NBER working paper series no. w3004

Language:

English

Physical Description:

1 online resource: illustrations (black and white);

Place of Publication:

Cambridge, Mass. National Bureau of Economic Research 1989.

Summary:

We compare "real business cycle" and increasing returns models of economic fluctuations. In these models, business cycles are driven by productivity changes resulting either from technology shocks or from crucial building blocks that give both types of models hope of fitting the data. These building blocks include durability of goods, specialized labor, imperfect credit and elastic labor supply. We also present new evidence on co-movement of both outputs sand labor inputs across sectors and on the increasing returns model is easier to reconcile with the data than the real business cycle model.

Notes:

Print version record

June 1989.