Investment shocks and business cycles
By: Alejandro Justiniano, Giorgio E. Primiceri, Andrea Tambalotti.
Contributors: Primiceri, Giorgio E., 1974-; Tambalotti, Andrea, 1973-; National Bureau of Economic Research.
Series: NBER working paper series -- working paper 15570; Working paper series (National Bureau of Economic Research : Online) -- working paper no. 15570.
Publisher: National Bureau of Economic Research
Published: 2009
Place of publication: Cambridge, MA
Language: eng
Format: Electronic resource
Description: "We study the driving forces of fluctuations in an estimated New Neoclassical Synthesis model of the U.S.  economy with several shocks and frictions.  In this model, shocks to the marginal efficiency of investment account for the bulk of fluctuations in output and hours at business cycle frequencies.  Imperfect competition and, to a lesser extent, technological frictions are the key to their transmission.  Labor supply shocks explain a large fraction of the variation in hours at very low frequencies, but are irrelevant over the business cycle.  This is important because their microfoundations are widely regarded as unappealing"--National Bureau of Economic Research web site.
Notes: Title from PDF file as viewed on 12/22/2009.

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