Detrending and business cycle facts

Can Habit Formation Be Reconciled with Business Cycle Facts?

Many asset pricing puzzles can be explained when habit formation is added to standard preferences. We show that utility functions with a habit then gives rise to a puzzle of consumption volatility in place of the asset pricing puzzles when agents can choose consumption and labor optimally in response to more fundamental shocks. We show that the consumption reaction to technology shocks is too s...

Business Cycle Features In The Iranian Economy

CEP 16-09 Entrepreneurship and the Business Cycle: Stylized Facts from U.S. Venture Capital Activity

Firm-Specific Productivity Risk over the Business Cycle: Facts and Aggregate Implications

Is time-varying firm-level uncertainty a major cause or amplifier of the business cycle? This paper investigates this question in the context of a heterogeneous-firm RBC model with persistent firm-level productivity shocks and lumpy capital adjustment, where cyclical changes in uncertainty correspond naturally to cyclical changes in the cross-sectional dispersion of firm-specific Solow residual...

Graduate Macro Theory II: Stylized Business Cycle Facts and the Performance of the RBC Model

The convention within the literature is to look at HP detrended data to examine the business cycle. We focus on deviations from the smooth HP trend. There are, of course, alternative ways in which one can look at the cyclical component of the data (e.g. first differences, the Band Pass filter, linear detrending, etc.). “Business cycle moments” focus primarily on a variety of second moments. In ...