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...

In this paper, I develop a regression-based system of labor productivity equations which account for capital-embodied technological change and I incorporate this system into IDLIFT, a structural, macroeconomic input-output model of the U.S. economy. Builders of regressionbased forecasting models have long had difficulty finding labor productivity equations that exhibit the “Solowian” property t...

The paper shows how a dynamic neoclassical AS-AD can be derived and used to describe business cycles and growth trends to undergraduates. Derived within the Ramsey-Cass-Koopmans (RCK) model, the AS-AD is the stationary equilibrium of the deterministic dynamic general equilibrium framework. Allowing Solow exogenous growth, the AS-AD is derived along the balanced growth path equilibrium. The deri...

Total Factor Productivity (TFP) is the portion of output not explained by the amount of inputs used in production. The following definition describes the measurement and importance of TFP for growth, fluctuations and development as well as likely future directions of research. Total Factor Productivity (TFP) is the portion of output not explained by the amount of inputs used in production. As s...

We examine a policy proposed by Stiglitz in the context of a multi-sector model proposed by Robinson, Solow, and Srinivasan (henceforth the RSS model) and recently reconsidered by Khan and Mitra. We characterize the policy by drawing on and extending dynamical systems theory in order to divide the parameter space into regions of a unique attracting cycle of each period and a region of no attrac...

We give a proof for a conjecture suggested by Olivier de La Grandville and Robert M. Solow, which says that the general mean of two positive numbers, as a function of its order, has one and only one inflection point.