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on Dynamic General Equilibrium |
| By: | Rym Aloui (GATE Lyon Saint-Étienne - Groupe d'analyse et de théorie économique - ENS Lyon - École normale supérieure - Lyon - UL2 - Université Lumière - Lyon 2 - UCBL - Université Claude Bernard Lyon 1 - Université de Lyon - UJM - Université Jean Monnet [Saint-Étienne] - Université de Lyon - CNRS - Centre National de la Recherche Scientifique); Aurélien Eyquem (GATE Lyon Saint-Étienne - Groupe d'analyse et de théorie économique - ENS Lyon - École normale supérieure - Lyon - UL2 - Université Lumière - Lyon 2 - UCBL - Université Claude Bernard Lyon 1 - Université de Lyon - UJM - Université Jean Monnet [Saint-Étienne] - Université de Lyon - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | We investigate the link between the size of government indebtedness and the effectiveness of government spending shocks in normal times and at the Zero Lower Bound (ZLB). We develop a New Keynesian model with capital, distortionary taxes and public debt in which the ZLB constraint on the nominal interest rate may be binding. In normal times, high steady-state levels of government debt to GDP lead to reduced output multipliers. After a negative capital quality shock that pushes the economy at the ZLB however, high steadystate debt levels produce larger output multipliers. Our results rely on the fact that fiscal policy becomes self-financing at the ZLB, and that distortionary taxes rise (respectively fall) after a spending shock at the steady state (resp. ZLB). Our results have non-trivial consequences on the design of optimized spending policies in the event of large economic downturns. |
| Keywords: | Zero Lower Bound,Fiscal Policy,Distortionary Taxes,Public Debt |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-01942746&r=all |
| By: | Jorge Duran (European Commission [Brussels]); Omar Licandro (School of Economics, University of Nottingham - UON - University of Nottingham, UK, Instituto de Análisis Económico (CSIC) and Barcelona GSE) |
| Abstract: | Bridging modern macroeconomics and the economic theory of index numbers, this paper shows that real output growth as measured by National Income and Product Accounts (NIPA) is a welfare based measure. In a two-sector dynamic general equilibrium model of heterogeneous households, recursive preferences and quasi-concave technology, individual welfare depends on present and future consumption. In this context, the Bellman equation provides a representation of preferences over current consumption and investment. Applying standard index number theory to this representation of preferences, it is shown that the Fisher-Shell true quantity index is equal to the Divisia index in turn well approximated by the Fisher ideal chain index used in NIPA. |
| Keywords: | growth measurement,quantity indexes,equivalent variation,NIPA,Fisher-Shell index,Divisia index,embodied technical change |
| Date: | 2018–11 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-01943948&r=all |
| By: | Stéphane Auray (ENSAI - Ecole Nationale de la Statistique et de l'Analyse de l'Information - Ensai, Ecole Nationale de la Statistique et de l'Analyse de l'Information, CREST - Centre de Recherche en Economie et Statistique [Bruz] - ENSAI - Ecole Nationale de la Statistique et de l'Analyse de l'Information [Bruz], ULCO - Université du Littoral Côte d'Opale); Aurélien Eyquem (GATE Lyon Saint-Étienne - Groupe d'analyse et de théorie économique - ENS Lyon - École normale supérieure - Lyon - UL2 - Université Lumière - Lyon 2 - UCBL - Université Claude Bernard Lyon 1 - Université de Lyon - UJM - Université Jean Monnet [Saint-Étienne] - Université de Lyon - CNRS - Centre National de la Recherche Scientifique); Paul Gomme (CIREQ - Centre interuniversitaire de recherche en économie quantitative - Université de Montréal, Concordia University [Montreal]) |
| Abstract: | Following the Great Recession, U.S. government debt levels exceeded 100% of output. We develop a macroeconomic model to evaluate the role of various shocks during and after the Great Recession; labor market shocks have the greatest impact on macroeconomic activity. We then evaluate the consequences of using alternative fiscal policy instruments to implement a fiscal austerity program to return the debt-output ratio to its pre-Great Recession level. Our welfare analysis reveals that there is not much difference between applying fiscal austerity through government spending, the labor income tax, or the consumption tax; using the capital income tax is welfare-reducing. |
| Keywords: | Fiscal policies,tax reforms,government debt,government deficits |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-01942719&r=all |
| By: | Leyva Gustavo; Urrutia Carlos |
| Abstract: | We analyze the joint impact of employment protection and informality on macroeconomic volatility and the propagation of shocks in emerging economies. For this, we propose a small open economy business cycle model with frictional labor markets, labor regulation, and an informal sector, modeled as self-employment. The model is calibrated to the Mexican economy, in particular to business cycle moments for employment and informality obtained from our own calculations with the ENOE survey for the period 2005-2016. We show that international interest rate shocks, which affect specifically job creation in the formal sector, are key to obtain a counter-cyclical informality rate. In our model both the economy without an informal sector and the economy with informality but a lower burden of labor regulation feature higher volatility in employment but smaller fluctuations in TFP and output. |
| Keywords: | informality;business cycle;small open economy;job creation;employment protection;international interest rate shocks |
| JEL: | E24 E32 F44 J65 |
| Date: | 2018–11 |
| URL: | http://d.repec.org/n?u=RePEc:bdm:wpaper:2018-19&r=all |
| By: | Stéphane Auray (ENSAI - Ecole Nationale de la Statistique et de l'Analyse de l'Information - Ensai, Ecole Nationale de la Statistique et de l'Analyse de l'Information, CREST - Centre de Recherche en Economie et Statistique [Bruz] - ENSAI - Ecole Nationale de la Statistique et de l'Analyse de l'Information [Bruz], ULCO - Université du Littoral Côte d'Opale); Aurélien Eyquem (GATE Lyon Saint-Étienne - Groupe d'analyse et de théorie économique - ENS Lyon - École normale supérieure - Lyon - UL2 - Université Lumière - Lyon 2 - UCBL - Université Claude Bernard Lyon 1 - Université de Lyon - UJM - Université Jean Monnet [Saint-Étienne] - Université de Lyon - CNRS - Centre National de la Recherche Scientifique); Xiaofei Ma (CREST - Centre de Recherche en Economie et Statistique [Bruz] - ENSAI - Ecole Nationale de la Statistique et de l'Analyse de l'Information [Bruz], UEVE - Université d'Évry-Val-d'Essonne) |
| Abstract: | We develop a two-country model with an explicitly microfounded interbank market and sovereign default risk. Calibrated to the core and the periphery of the Euro Area, the model gives rise to a debt-banks-credit loop that substantially amplifies the effects of financial shocks, especially for the periphery. We use the model to investigate the effects of a stylized public asset purchase program at the steady state and during a crisis. We find that it is more effective in stimulating the economy during a crisis, in particular for the periphery. |
| Keywords: | Recession,Interbank Market,Sovereign Default Risk,Asset Purchases |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-01942734&r=all |
| By: | Lilia Cavallari; Federico Etro |
| Abstract: | We generalize the demand side of a Real Business Cycle model introducing non-homothetic preference aggregators over differentiated final goods. Under monopolistic competition this generates markups which vary with consumption. We estimate a flexible preference specification through Bayesian methods and obtain substitutability across goods increasing with consumption. The closed-economy model magnifies the propagation of shocks through additional substitution effects on labor supply and consumption. In an open-economy framework, it also generates positive comovements of output, labor and investment and reduces consumption correlation between countries. In particular, a positive shock in the Home country improves its terms of trade, which promotes consumption in the Home country but also production in the Foreign country. |
| Keywords: | RBC, non-homothetic preference aggregators, variable markups, international macroeconomics. |
| JEL: | E1 E2 E3 F4 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:frz:wpaper:wp2018_30.rdf&r=all |
| By: | Halvor Mehlum; Ragnar Torvik; Simone Valente |
| Abstract: | We study the consequences of age-dependent preferences for economic growth and structural change in a two-sector model with overlapping generations and nondimishing returns to capital. Savings and accumulation rates depend on the relative price of services consumed by old agents and on the intergenerational distribution of income. The feedback effects originating in preferences and income distribution yield three possible long-run growth outcomes: sustained endogenous growth, decumulation traps, and bounded accumulation. In the endogenous growth scenario, the transition features rising savings and accumulation rates accompanied by distributional shifts in favor of young workers, growing employment and rising prices in the service sector. Traps are triggered by initially low capital in manufacturing and low employment in services. Bounded accumulation yielding zero long-run growth in per capita incomes is induced by preferences, not by diminishing returns to capital. |
| Keywords: | Endogenous growth, structural change, overlapping generations |
| Date: | 2018–12 |
| URL: | http://d.repec.org/n?u=RePEc:bny:wpaper:0072&r=all |
| By: | Dean Corbae; Pablo D'Erasmo |
| Abstract: | We develop a model of banking industry dynamics to study the quantitative impact of capital requirements on equilibrium bank risk taking, commercial bank failure, interest rates on loans, and market structure. We propose a market structure where big banks with market power interact with small, competitive fringe banks. Banks face idiosyncratic funding shocks in addition to aggregate shocks to the fraction of performing loans in their portfolio. A nontrivial bank size distribution arises out of endogenous entry and exit, as well as banks' buffer stock of net worth. We show the model predictions are consistent with untargeted business cycle properties, the bank lending channel, and empirical studies of the role of concentration on financial stability. We then conduct a series of counterfactuals (including countercyclical and size contingent (e.g. SIFI) capital requirements). We find that regulatory policies can have an important impact on market structure in the banking industry which, along with selection effects, can generate changes in allocative efficiency. |
| JEL: | E44 G21 L11 |
| Date: | 2019–01 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:25424&r=all |
| By: | Yoosoon Chang; Junior Maih; Fei Tan |
| Abstract: | This article studies the estimation of state space models whose parameters are switching endogenously between two regimes, depending on whether an autoregressive latent factor crosses some threshold level. Endogeneity stems from the sustained impacts of transition innovations on the latent factor, absent from which our model reduces to one with exogenous Markov switching. Due to the flexible form of state space representation, this class of models is vastly broad, including classical regression models and the popular dynamic stochastic general equilibrium (DSGE) models as special cases. We develop a computationally efficient filtering algorithm to estimate the nonlinear model. Calculations are greatly simplified by appropriate augmentation of the transition equation and exploiting the conditionally linear and Gaussian structure. The algorithm is shown to be accurate in approximating both the likelihood function and filtered state variables. We also apply the filter to estimate a small-scale DSGE model with threshold-type switching in monetary policy rule, and find apparent empirical evidence of endogeneity in the U.S. monetary policy shifts. Overall, our approach provides a greater scope for understanding the complex interaction between regime switching and measured economic behavior. |
| Keywords: | state space model, regime switching, endogenous feedback, filtering, DSGE model |
| Date: | 2018–11 |
| URL: | http://d.repec.org/n?u=RePEc:bny:wpaper:0067&r=all |
| By: | Aleksandar Vasilev (Lincoln International Business School, UK) |
| Abstract: | We introduce internal consumption habits into a real-business-cycle setup augmented with a detailed government sector. We calibrate the model to Bulgarian data for the period following the introduction of the currency board arrangement (1999-2016). We investigate the quantitative importance of the presence of internal consumption habits motive for the propagation cyclical uctuations in Bulgaria. Allowing for habits in consumption improves the model performance against data, and in addition this extended setup dominates the standard RBC model framework without habits, e.g., Vasilev (2009). |
| Keywords: | Business fluctuations, consumption habits, Bulgaria |
| JEL: | E32 E22 E37 |
| Date: | 2018–09 |
| URL: | http://d.repec.org/n?u=RePEc:sko:wpaper:bep-2018-09&r=all |
| By: | Julien Albertini (GATE Lyon Saint-Étienne - Groupe d'analyse et de théorie économique - ENS Lyon - École normale supérieure - Lyon - UL2 - Université Lumière - Lyon 2 - UCBL - Université Claude Bernard Lyon 1 - Université de Lyon - UJM - Université Jean Monnet [Saint-Étienne] - Université de Lyon - CNRS - Centre National de la Recherche Scientifique); Anthony Terriau (GATE Lyon Saint-Étienne - Groupe d'analyse et de théorie économique - ENS Lyon - École normale supérieure - Lyon - UL2 - Université Lumière - Lyon 2 - UCBL - Université Claude Bernard Lyon 1 - Université de Lyon - UJM - Université Jean Monnet [Saint-Étienne] - Université de Lyon - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | In developing countries, informality is mainly concentrated on younger and older workers. In this paper, we propose a dual labor market theory that highlights how frictions and taxation in the formal sector as well as educational choices interact to shape the informality rate over the life-cycle. We develop a life-cycle model with search frictions, skill heterogeneities, and endogenous educational choices. We carry out a numerical analysis and show that our model reproduces remarkably well the life-cycle patterns of informality, non-employment and formal employment in Argentina. We analyze several public policies and show that an educational grant reduces both informality and non-employment and may be fully financed by the extra tax revenues generated by the increase in formal employment and wages. Lowering taxes may achieve similar results but is detrimental for the government budget, in the case of Argentina, despite increasing the base on which they are levied. |
| Keywords: | Informality,Search and Matching,Life-cycle,Public policy,Laffer curve |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-01957491&r=all |
| By: | Shintaro Asaoka (Institute of Economic Research, Kyoto University) |
| Abstract: | This study examines the existence of bubbles in an economy with a low growth rate. By using an overlapping-generations model with Matsuyama's (1999) production sector, it is shown a bubble exists in an economy with a low growth rate. If consumers can borrow assets when they are young, then there is a unique cycle with a bubble moving back and forth between two phases. In one phase, the output growth rate is low and innovation occurs. In the other phase, the output growth rate is high and there is no innovation. Therefore, a bubble also exists in an economy with a high growth rate. On the contrary, cycles cannot emerge if consumers save assets when they are young. |
| Keywords: | bubbles, endogenous growth model |
| JEL: | D91 E32 O41 |
| Date: | 2018–01 |
| URL: | http://d.repec.org/n?u=RePEc:kyo:wpaper:985&r=all |
| By: | Aleksandar Vasilev (Lincoln International Business School, UK) |
| Abstract: | We introduce progressive consumption taxation into a real-business-cycle setup augmented with a detailed government sector. We calibrate the model to Bulgarian data for the period following the introduction of the currency board arrangement (1999-2016). We investigate the quantitative importance of the presence of of progressive taxation of consumption expenditures for the stabilization of cyclical uctuations in Bulgaria. We find the quantitative effect of such a tax to be very small, and thus not important for either business cycle stabilization, or public finance issues. |
| Keywords: | business cycles, progressive consumption taxation, Bulgaria |
| JEL: | E24 E32 |
| Date: | 2018–12 |
| URL: | http://d.repec.org/n?u=RePEc:sko:wpaper:bep-2018-12&r=all |
| By: | Shuhei Takahashi (Institute of Economic Research, Kyoto University) |
| Abstract: | Does wage setting exhibit strategic complementarity and produce multiple equilib- ria? This study constructs a discrete-time New Keynesian model in which the timing of individual wage adjustments is endogenous. I explore steady-state equilibrium of the state-dependent wage-setting model both analytically and numerically. For reasonable parameter values, complementarity in wage setting is weak and multiple equilibria are unlikely to exist at the steady state. The uniqueness of equilibrium is robust to imperfect consumption insurance. |
| Keywords: | State-dependent wage setting, New Keynesian model, Multiple equilibria, Strategic complementarity, Incomplete markets, Deflation |
| JEL: | E24 E31 E32 E52 |
| Date: | 2018–05 |
| URL: | http://d.repec.org/n?u=RePEc:kyo:wpaper:991&r=all |
| By: | Myunghyun Kim (Economic Research Institute, The Bank of Korea) |
| Abstract: | I introduce commodities and countries¡¯ different commodity trade structures into an otherwise standard two-country model to analyze international business cycles between the U.S. and commodity-exporting countries. In the model, only the foreign country (the commodity-exporting country) produces commodities and exports them to the home country (the U.S., the commodity-importing country). The model produces international business cycle statistics that are closer to the data than a standard model. In particular, the output correlation between the two countries increases and the consumption correlation falls compared to the standard model. Notably, unlike standard models, this model yields an output correlation that exceeds the consumption correlation, which mitigates the ¡°quantity anomaly¡± that was previously noted in the literature. Commodity consumption and the complementarity between commodities and noncommodity goods in consumption play key roles in generating this result. |
| Keywords: | International Business Cycles, Commodity-exporting countries, Commodity Trade Structures |
| JEL: | F40 F41 F44 |
| Date: | 2018–12–28 |
| URL: | http://d.repec.org/n?u=RePEc:bok:wpaper:1847&r=all |
| By: | Nicolas Abad (CREAM - Centre de Recherche en Economie Appliquée à la Mondialisation - UNIROUEN - Université de Rouen Normandie - NU - Normandie Université - IRIHS - Institut de Recherche Interdisciplinaire Homme et Société - UNIROUEN - Université de Rouen Normandie - NU - Normandie Université); Alain Venditti (AMSE - Aix-Marseille Sciences Economiques - EHESS - École des hautes études en sciences sociales - AMU - Aix Marseille Université - ECM - Ecole Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique, EDHEC - EDHEC Business School) |
| Abstract: | We examine the impact of balanced-budget labor income taxes on the existence of expectation- driven business cycles in a two-sector version of the Schmitt-Grohé and Uribe (SGU) [18] model with constant government expenditures and counter-cyclical taxes. Our results show that the destabilizing impact of labor income taxes strongly depends on the capital intensity difference across sectors. Local indeterminacy is indeed more likely when the consumption good sector is capital intensive, as the minimal tax rate decreases, and less likely when the investment good sector is capital intensive, as the minimal tax rate increases. The implication of this result can be quantitatively significant. Indeed, when compared to SGU, local indeterminacy can be either completely ruled out for all OECD countries when the investment good is sufficiently capital intensive, or drastically improved, delivering indeterminacy for a larger set of OECD countries, if the consumption good is sufficiently capital intensive. Focusing however on recent estimates of the sectoral capital shares corresponding to the empirically plausible case of a capital intensive consumption good, we find that there is a significant increase of the range of economically relevant labor tax rates (from a minimum tax rate of 30% to 24.7%) for which local indeterminacy arises with respect to the aggregate formulation of SGU. |
| Keywords: | aggregate (in)stability,local indeterminacy,expectations-driven fluctuations,labor income taxes,balanced-budget rule,infinite-horizon two-sector model,capital intensity difference |
| Date: | 2018–06 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-01934782&r=all |
| By: | Muriel Dal-Pont Legrand (Université Côte d'Azur, France; GREDEG CNRS); Harald Hagemann (University of Hohenheim, Stuttgart) |
| Abstract: | There is no doubt that DSGE (Dynamic Stochastic General Equilibrium) models which were considered benchmark models during the Great Moderation period, were challenged enormously when the global financial crisis developed. As business cycles models, their capacity to provide insights into the origins and mechanisms of propagation failed in the context of the crisis. This questions their validity also as a basis for economic policy advice. As a consequence, many economists are pleading for new benchmarks or for a deep reconsideration of both the theoretical and empirical sides of the arguments. Although no new consensus has yet emerged on possible "solutions" to or reorientations of the research program in this field, many economists are trying to understand where modern macroeconomics went wrong. As historians of economic thought, we propose to retrace the evolution of business cycles theory and of its empirical practices in order to better understand the way this literature today addresses macroeconomic volatility and eventually crises. |
| Date: | 2019–01 |
| URL: | http://d.repec.org/n?u=RePEc:gre:wpaper:2019-01&r=all |
| By: | Been-Lon Chen (Institute of Economics, Academia Sinica); Yunfang Hu (Graduate School of Economics, Kobe University); Kazuo Mino (Faculty of Economics, Doshisha University) |
| Abstract: | This paper examines the stabilization effect of income taxation rules in small open economies. We show that if endogenous growth is not allowed, belief-driven fl?uctuation will not emerge, but the economy displays total instability under certain conditions and nonlinear income tax may recover saddle point stability. If endogenous growth is possible and if the taxation rule specifi?es the rate of income tax held in the balanced growth equi- librium, then equilibrium indeterminacy will not arise either. However, if the long run tax rate is not predetermined, then, equilibrium path of the economy may be indeterminate, and an appropriate taxation rule can establish determinacy. |
| Keywords: | Taxation Rule, Indeterminacy, Small Open Economy, Endogenous Growth |
| JEL: | E62 O41 |
| Date: | 2018–08 |
| URL: | http://d.repec.org/n?u=RePEc:kyo:wpaper:997&r=all |
| By: | Swapnil Singh (Center for Excellence in Finance and Economic Research (CEFER), Bank of Lithuania); Christian A. Stoltenbergz (University of Amsterdam and Tinbergen Institute) |
| Abstract: | We develop a consumption-savings model that distinguishes households’ perceived income uncertainty from income uncertainty as measured by an econometrician. Households receive signals on their future disposable income that can drive a gap between the two uncertainties. With an uncertainty gap that is consistent with direct estimates stemming from subjective income expectations, the model jointly explains three consumption inequality and insurance measures in US micro data that are not captured without the difference: (i) the cross-sectional variance of households’ consumption, (ii) the covariance of current consumption and income growth and (iii) the income-conditional mean of household consumption. |
| Keywords: | Risk sharing, Advance information, Consumption insurance, Endogenous borrowing constraints, Limited commitment |
| JEL: | E21 D31 D52 |
| Date: | 2018–12–21 |
| URL: | http://d.repec.org/n?u=RePEc:lie:wpaper:55&r=all |
| By: | Junkee Jeon; Hyeng Keun Koo; Kyunghyun Park |
| Abstract: | We study a finite horizon optimal contracting problem of a risk-neutral principal and a risk-averse agent who receives a stochastic income stream when the agent is unable to make commitments. The problem involves an infinite number of constraints at each time and each state of the world. Miao and Zhang (2015) have developed a dual approach to the problem by considering a Lagrangian and derived a Hamilton-Jacobi-Bellman equation in an infinite horizon. We consider a similar Lagrangian in a finite horizon, but transform the dual problem into an infinite series of optimal stopping problems. For each optimal stopping problem we provide an analytic solution by providing an integral equation representation for the free boundary. We provide a verification theorem that the value function of the original principal's problem is the Legender-Fenchel transform of the integral of the value functions of the optimal stopping problems. We also provide some numerical simulation results of optimal contracting strategies |
| Date: | 2018–12 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1812.11669&r=all |
| By: | Fabio Canova; Christian Matthes |
| Abstract: | We describe how to use the composite likelihood to ameliorate estimation, computational, and inferential problems in dynamic stochastic general equilibrium models. We present a number of situations where the methodology has the potential to resolve well-known problems and formally justi?es existing practices. In each case we consider, we provide an example to illustrate how the approach works and its properties in practice. |
| Keywords: | Dynamic structural models, composite likelihood, identification, singularity, large scale models, panel data |
| Date: | 2018–10 |
| URL: | http://d.repec.org/n?u=RePEc:bny:wpaper:0068&r=all |
| By: | McQuinn, Kieran; Varthalitis, Petros |
| Abstract: | In this paper we examine the performance of the Irish economy over the period 2008 to 2014. In particular we examine whether the recovery observed was due to the successful adoption of structural reforms in labour and product markets or whether the improved performance was due to a rebalancing of the Irish economy, post 2008, away from the disproportionate influence of the construction (non-tradable) sector and back to the more productive tradable sector? Prior to 2007 had seen the emergence of a significant, property-related credit boom which resulted in the Irish economy being increasingly influenced by the non-tradable sector. This was in sharp contrast to the earlier period of the Celtic tiger, which had mainly relied on export-orientated growth. We use a small open economy DSGE model with a tradable and a non-tradable sector to examine this issue. Our results suggest that the financial crisis acted as a rebalancing mechanism for the Irish economy, with the tradable sector contracting less and recovering quicker than the non-tradable sector. Our model-based simulations indicate that the Irish recovery is mostly export-driven with structural reforms playing a very minor role in stimulating growth in the immediate period after the crisis. |
| Keywords: | Trade, Openness, Reforms, DSGE |
| JEL: | F3 F41 F43 |
| Date: | 2018–12–06 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:90416&r=all |
| By: | Amanda Michaud; David Wiczer |
| Abstract: | We evaluate the contribution of changing macroeconomic conditions and demographics to the increase in Social Security Disability Insurance (SSDI) over recent decades. Within our quantitative framework, multiple sectors differentially expose workers to health and economic risks, both of which affect individuals' decisions to apply for SSDI. Over the transition, falling wages at the bottom of the distribution increased awards by 27% in the 1980s and 90s and aging demographics rose in importance thereafter. The model also implies two-thirds of the decline in working-age male employment from 1985 to 2013, three-fourths of which eventually goes on SSDI. |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:nys:sunysb:18-12&r=all |
| By: | Ekaterina Pyltsyna (National Research University Higher School of Economics) |
| Abstract: | This study investigated the change of government spending multiplier when switching from managed exchange rate regime to the floating exchange rate regime for emerging countries. It was found that on-impact multiplier in floating exchange rate regime is smaller by 0.5 than the one in the managed exchange rate regime. In addition, it was found that the openness of the economy affects values of government spending multipliers. Also, for the first time, micro-founded government spending multiplier was estimated for Russia. The study was conducted with the use of panel SVAR and DSGE models. |
| Keywords: | fiscal multiplier, government expenditures, exchange rate regime change, panel SVAR, DSGE, emerging countries, Russia. |
| JEL: | E62 E63 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:hig:wpaper:206/ec/2018&r=all |