ON ENDOGENOUS BUSINESS CYCLES UNDER INCREASING RETURNS TO VARIETY AND SECTOR‐SPECIFIC EXTERNALITY
| Autor: | Jang-Ting Guo, Wei‐Neng Wang, Juin-jen Chang |
|---|---|
| Rok vydání: | 2020 |
| Předmět: |
Economics and Econometrics
Returns to scale 05 social sciences Small open economy Context (language use) Investment (macroeconomics) General Business Management and Accounting Microeconomics Product (business) 0502 economics and business Business cycle Economics Market power 050207 economics Externality 050205 econometrics |
| Zdroj: | Economic Inquiry. 59:532-548 |
| ISSN: | 1465-7295 0095-2583 |
| DOI: | 10.1111/ecin.12910 |
| Popis: | We examine the theoretical as well as quantitative interrelations between endogenous business cycles, increasing returns to product variety and sector‐specific productive externalities within a two‐sector real business cycle model. In a calibrated version of our benchmark closed‐economy setting, the threshold level of investment externalities needed for equilibrium indeterminacy is found to be monotonically increasing in the degree of market competitiveness. We also study the model's local stability properties (i) when the parameters that govern the level of intermediate‐good producers' market power and the strength of variety effects are disentangled; and (ii) in the context of a small open economy. (JEL E30, E32, O41) |
| Databáze: | OpenAIRE |
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