Sectoral reallocations, real estate shocks, and productivity divergence in Europe

Do Real Estate Shocks Affect Corporate Investment?

Real Exchange Rates and Sectoral Productivity in the Eurozone

We investigate the link between real exchange rates and sectoral total factor productivity measures for countries in the Eurozone. Real exchange rate patterns closely accord with an amended Balassa-Samuelson interpretation, both in cross-section and time series. We construct a sticky price dynamic general equilibrium model to generate a crosssection and time series of real exchange rates that c...

House Price Co-Movement and Real Estate Diversification in Europe

The house price boom in major industrialized countries since the early 1990s has been unprecedented. Co-movement is a key feature of it and it has been attributed by scholars to synchronization of monetary policy, financial liberalization, integration of international financial markets, as well as global business cycle linkages. In this paper we focus on seven European countries, all members of...

How Important Are Sectoral Shocks?

I quantify the contribution of sectoral shocks to business cycle fluctuations in aggregate output. I develop and estimate a multi-industry general equilibrium model in which each industry employs the material and capital goods produced by other sectors. Using data on U.S. industries’ input prices and input choices, I find that the goods produced by different industries are complements to one an...

Earnings II: Sectoral Shocks and Aggregate Disturbances

This chapter represents a significant departure from Chapter 19, which also focused on earnings. Instead of examining how earnings are distributed across a given population of workers, we shall now examine how individual and aggregate earnings evolve over time. The central thesis that we shall explore is that firms and workers are regularly buffeted by an assortment of random shocks or disturba...