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Full-Text Articles in Social and Behavioral Sciences
(Wp 2011-05) 'Til Recession Do Us Part: Booms, Busts, And Divorce In The United States, Abdur Chowdhury
(Wp 2011-05) 'Til Recession Do Us Part: Booms, Busts, And Divorce In The United States, Abdur Chowdhury
Abdur R. Chowdhury
A general hypothesis regarding the impact of permanent income levels and business cycle fluctuations on divorce rate at the state level in the United States is analyzed in the paper. Using data for 45 states over the 1978-2009 sample period, the paper shows that the higher the level of transitory income, the higher is the incidence of divorce. In other words, divorce is pro-cyclical. Why do divorce decrease during recession and increase during expansion? When an economy is in crisis and people’s incomes are low, the cost of divorce will prevent a couple from divorcing irrespective of the quality of …
Government Spending Effects: Synopsis, Riccardo Fiorito
Government Spending Effects: Synopsis, Riccardo Fiorito
riccardo fiorito
An updated, schematic, survey on government spending effects in the macroeconomic literature
Business Cycle Determinants Of Us Foreign Direct Investments, Lilia Cavallari, Stefano D'Addona
Business Cycle Determinants Of Us Foreign Direct Investments, Lilia Cavallari, Stefano D'Addona
Lilia Cavallari
This article investigates the role of output fluctuations and exchange rate volatility in driving US FDIs. Using a sample of 46 economies over the period 1982 to 2009, we provide the evidence of a positive relation between US FDI and host country’s cyclical conditions. Allowing for asymmetry over the business cycle, we find that the output elasticity of foreign investments is higher in booms than in recessions. An increase in exchange rate volatility, on the other hand, has a strong deterrent effect on US foreign investments. This effect is fairly stable over the business cycle.
A Note On Firm Entry, Markups And The Business Cycle, Lilia Cavallari
A Note On Firm Entry, Markups And The Business Cycle, Lilia Cavallari
Lilia Cavallari
This paper proposes a monetary model with firm entry as a means for alleviating the difficulties of real business cycle models in reproducing the smoothness and persistence of macroeconomic variables together with the volatility of profits and markups. Simulations show that my baseline model matches the unconditional moments of consumption, output, hours, markups and profits in US data fairly well. In addition, it implies a positive e¤ect of a monetary expansion on business formation as in the data. Allowing for differences in the composition of the investment and the consumption baskets is essential for these results.
All The Incentives Are Here, David Thomas
All The Incentives Are Here, David Thomas
David Chandler Thomas, PhD
A book review of the Bethany McLean and Joe Nocera 2010 book, All the Devils Are Here.
Modelling Entry Costs: Does It Matter For Business Cycle Transmission?, Lilia Cavallari
Modelling Entry Costs: Does It Matter For Business Cycle Transmission?, Lilia Cavallari
Lilia Cavallari
This paper studies the business cycle implications of entry costs in a dynamic stochastic general equilibrium model with firm entry and nominal rigidity. Simulations show that my baseline model matches the dynamics observed in the data fairly well. Remarkably, it overcomes the well-known difficulties of business cycle models in reproducing the persistence, smoothness and cyclicality of macroeconomic aggregates. I stress that capital entry costs are essential for these results.
Output And Interest Rate Volatility As Determinants Of Fdi, Lilia Cavallari, Stefano D'Addona
Output And Interest Rate Volatility As Determinants Of Fdi, Lilia Cavallari, Stefano D'Addona
Lilia Cavallari
This paper examines the role of country-specific sources of output and interest rate volatility in driving FDI activities. Building on a dataset that comprises bilateral FDI flows among 24 OECD economies over the period 1985-2007, we find that output and interest rate volatility mainly act as push factors, i.e. they are more effective in deterring rather than encouraging foreign investments. A rise in host country volatilities does reduce the amount of FDI outflows in the recipient country, even after controlling for the state of the cycle. Source country volatilities, on the contrary, do not have a systematic effect on foreign …
Business Cycle And Structural Time Series: Warnings And Hints, Riccardo Fiorito
Business Cycle And Structural Time Series: Warnings And Hints, Riccardo Fiorito
riccardo fiorito
Structural time-series model can help reconcile business cycle analysis with basic economic theory assumptions