Growth, Slowdowns, and Recoveries

Bianchi, Francesco; Kung, Howard

doi:10.2139/ssrn.2577505

Cited by 37 publications

(55 citation statements)

References 80 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Jørgensen and Ravn () document the same set of stylized facts as in the present article and show that they can be accounted for by a model with variable technology utilization, along the lines of Bianchi et al. ().…”

Section: Introductionsupporting

confidence: 66%

Fiscal Stimulus With Learning‐by‐doing

D'Alessandro

Fella

Melosi

2019

Int Economic Review

View full text Add to dashboard Cite

Using a Bayesian structural vector autoregression analysis, we document that an increase in government purchases raises private consumption, the real wage, and total factor productivity (TFP) while reducing inflation. These three facts are hard to reconcile with both neoclassical and New Keynesian models. We extend a standard New Keynesian model to allow for skill accumulation through past work experience. An increase in government spending increases hours and induces skill accumulation and higher measured TFP and real wages in subsequent periods. Future marginal costs fall lowering expected inflation and, through the monetary policy rule, the real interest rate. Consumption increases as a result.

show abstract

Section: Introductionsupporting

confidence: 66%

Fiscal Stimulus With Learning‐by‐doing

D'Alessandro

Fella

Melosi

2019

Int Economic Review

View full text Add to dashboard Cite

show abstract

“…Our paper is closely related to the recent work of Anzoategui, Comin, Gertler and Martinez (2019), Benigno and Fornaro (2018), Bianchi, Kung and Morales (2019), Garcia-Macia (2015), Guerron-Quintana and Jinnai (2019), Moran and Queraltó (2018) and Queralto (2019) who integrate endogenous growth into a business cycle framework. Among these papers, our framework is most similar to that of Benigno and Fornaro (2018), who identify the possibility of an economy entering a phase of persistent liquidity trap and low TFP growth due to pessimistic expectations.…”

Section: Related Literaturementioning

confidence: 58%

“…There is a recent synchronous literature that explores these interactions, includingAnzoategui et al (2019),Bianchi, Kung and Morales (2019) andBenigno and Fornaro (2018). Ours is the first paper to analyze the interaction of optimal monetary policy at the ZLB, aggregate demand and endogenous growth.…”

mentioning

confidence: 99%

Output Hysteresis and Optimal Monetary Policy

Garga

Singh

2018

SSRN Journal

View full text Add to dashboard Cite

We analyze the implications for monetary policy when deficient aggregate demand can cause a permanent loss in potential output, a phenomenon termed as output hysteresis. In the model, incomplete stabilization of a temporary shortfall in demand reduces the return to innovation, thus reducing TFP growth and generating a permanent loss in output. Using a purely quadratic approximation to welfare under endogenous growth, we derive normative implications for monetary policy. Away from the zero lower bound (ZLB), optimal commitment policy sets interest rates to eliminate output hysteresis. A strict inflation targeting rule implements the optimal policy. However, when the nominal interest rate is constrained at the ZLB, strict inflation targeting is sub-optimal and admits output hysteresis. A new policy rule that targets output hysteresis returns the output to the pre-shock trend and approximates the welfare gains under optimal commitment policy. A central bank unable to commit to future policy actions suffers from hysteresis bias: it does not offset past losses in potential output.

show abstract

“…Nevertheless, the central point of discussion remained whether temporary downturns in output, R&D spending, and employment have a deeper and long‐lasting impact on productivity dynamics? (Saint‐Paul, 1993; Malley and Muscatelli, 1999; Bianchi et al ., 2019). The standard approach in business cycle models initiated by Kydland and Prescott (1982) considers the MFP as a source of exogenous shocks and the main driving force behind business cycles, which generate fluctuations in economic growth.…”

Section: Introductionmentioning

confidence: 99%

Measurement and Determinants of Multi‐factor Productivity: A Survey of Literature

Ahmed

Bhatti

2020

Journal of Economic Surveys

View full text Add to dashboard Cite

This paper surveys and synthesizes fast‐growing literature on the measurement and determinants of multi‐factor productivity (MFP). We identify three strands of the literature to measure MFP: the first is growth accounting, which decomposes observed economic growth into the contribution of factor inputs and technological change, called the Solow Residual; the second is index number methods, accompanied by frontier techniques; the third is growth regressions and econometric methods used to estimate productivity across countries and regions. We keep our focus on assessing the major strengths and weaknesses of commonly used methods for MFP measurement and categorize existing literature on the determinants of MFP growth into macroeconomic and institutional factors. We attempt to provide a reassessment and thematic survey of literature on the drivers of aggregate productivity, enabling policymakers to formulate effective economic policy.

show abstract

Growth, Slowdowns, and Recoveries

Cited by 37 publications

References 80 publications

Fiscal Stimulus With Learning‐by‐doing

Fiscal Stimulus With Learning‐by‐doing

Output Hysteresis and Optimal Monetary Policy

Measurement and Determinants of Multi‐factor Productivity: A Survey of Literature

Contact Info

Product

Resources

About