The recent financial crisis has created a significant deviation between real world and existing business cycle theories. This paper follows the spirit of McGrattan and Prescott (2012) and reassesses this labor productivity puzzle by considering a real business cycle (RBC) model with R&D assets and organizational capital. It contributes to the literature in two ways. First, R&D assets and organi...

A widely used filter to extract a signal in a time series, in particular in the business cycle analysis, is the Hodrick-Prescott filter. The model that underlies the filter considers the data series as the sum of two unobserved component (signal and non signal) and a smoothing parameter which for quarterly series is set to a specified value. This paper proposes a generalization of the Hodrick-P...

In the case of Beal v. Doe, decided in 1977, the US Supreme Court ruled that states could constitutionally restrict money from Medicaid from funding elective abortions. After the 1973 case Roe v. Wade [2], in which the US Supreme Court had ruled that women have rights to terminate pregnancies within the first trimester [3], the state of Pennsylvania passed legislation that restricted the use of...

The New York Appellate Court ruled on 11 December 1977 in favor of Steven and Hetty Park and against Herbert Chessin for the wrongful life [5] of the Parks' child. In a wrongful life [5] case, a disabled or sometimes deceased child brings suit against a physician for failing to inform its parents of possible genetic defects, thereby causing harm to the child when born. Park v. Chessin [4] was t...

On purpose to extract trend and cycle from a time series many competing techniques have been developed. The probably most prevalent is the Hodrick Prescott filter. However this filter suffers from diverse shortcomings, especially the subjective choice of its penalization parameter. To this point penalized splines within a mixed model framework offer the advantage of a data driven derivation of ...

This paper argues that in assessing the effects of tax rates on aggregate hours of market work, it is essential to explicitly consider how the government spends tax revenues. Different choices regarding government spending lead to different elasticities of hours of work with regard to tax rates. I illustrate the empirical importance of this point by addressing the issue of hours worked and tax ...

The Hodrick–Prescott (HP) filter is a commonly used tool in macroeconomics to obtain the HP trend of macroeconomic variable. In macroeconomics, difference between original series and this called ‘cyclical component’. article, we derive autocovariance function spectrum cyclical component that consists constant, linear time trend, unit root process, weakly stationary process. We show such depends...

We study a general equilibrium model with production where financial markets are incomplete. At a competitive equilibrium firms take their production and financial decisions so as to maximize their value. If firms form perfectly competitive conjectures, as shown by Makowski (1983a,b), shareholders unanimously support value maximization and competitive equilibria are constrained Pareto optimal. ...

As I leaf through my own "ACL (Historical)" file (which, I am frightened to observe, goes back to the Fourth Annual Meeting, in 1966), and focus in particular on 1977, when I was President, it strikes me that pretty much everything significant that happened in the Association that year was the work of other people. Don Walker was completing the mammoth task of transferring all of the ACL's reco...