In most modern macroeconomic models, the steady state (or balanced growth path) of the system is a local attractor, in the sense that, in the absence of shocks, the economy would converge to the steady state. In this paper, ...
Are business cycles mainly a response to persistent exogenous shocks, or do they
instead reflect a strong endogenous mechanism which produces recurrent boom-bust
phenomena? In this paper we present new evidence in favour ...
Recessions often happen after periods of rapid accumulation of houses, consumer durables and business capital. This observation has led some economists, most notably Friedrich Hayek, to conclude that recessions often reflect ...
