This paper investigates the e¤ect of …nancial shocks using an estimated general equilibrium model that links the …rm’s ‡ows of …nancing with labor market variables. The results show that …nancial shocks have sizeable e¤ects on …nancial variables, vacancy posting, unemployment and wages. Shocks to the job destruction rate are important in describing ‡uctuations in output and unemployment. The an...

In this paper, we study the effects of economic factors on the intensity of internal armed conflicts. We show that adverse ethnic compositions in the form of ethnic dominance and polarization are a critical determinant of the way countries react to commodity-induced income shocks and that positive as well as negative income shocks can intensity ongoing conflicts. While negative income shocks in...

This paper develops a simple business-cycle model in which the financial sector originates a structural change that has large macroeconomic effects when private agents are gradually learning their economic environment. When the persistence of the unobserved process driving financial shocks to the leverage ratio changes, the responses of output and other aggregates under adaptive learning are si...

this paper tests the importance of real shocks as sources of fluctuations in iran’s economy. for this purpose, based on the work of boschen and mills, a set of non-monetary variables which can affect economic growth have been selected and by using an illustrative business cycle model in which the production depends on the past and current value of real shocks, the influence 01’ these variables ...

We formalize the idea that uncertainty is generated by news about future developments in economic conditions which are not perfectly predictable by the agents. With a simple model of limited information we show that uncertainty shocks can be obtained as the square of news shocks. We develop a two-step econometric procedure to estimate the effects of news and we find highly nonlinear effects. La...

Applying quantile regression techniques to Russian data we investigate the channels through which individuals experience changes in their well being. We find that married individuals in non-rural households with university-educated heads are less vulnerable to severe welfare shocks. For the most vulnerable individuals the labour market plays a key role in transmitting the effects of aggregate s...

1. Identification of the Disturbances In the second full year of operation of the international trading model built under the auspices of Project LINK we encountered the first of a series of world scale shocks, NEP (President Nixon’s New Economic Policy) with the closing of the gold window, surcharging of automobile imports, and a host of domestic economic restrictions. This phase, known in Jap...

Over the past two decades, endowments have become an increasingly important component of the typical university’s resource base. We examine how U.S. doctoral institutions’ endowment payout policies and spending decisions are affected by financial market shocks to endowments. While most endowments have formal payout policies intended to smooth payouts over time, we find that universities are mor...

This paper quantitatively investigates the role of technology shocks in propagating business cycles in a neoclassical growth model. I use the new technique of business cycle accounting (BCA) which enables me to maintain the basic framework of a standard growth model, but allows multiple propagation channels (referred to as wedges), technology ‡uctuations being one of them. My test case is Japan...

What are the sources of macroeconomic comovement among G-7 countries? Two main candidate explanations may be singled out: common shocks and common transmission mechanisms. In the paper it is shown that they are complementary, rather than alternative, explanations. By means of a large-scale factor vector autoregressive (FVAR) model, allowing for full economic and statistical identi...cation of a...