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2 edition of Equilibrium business cycles with idle resources and variable capacity utilization found in the catalog.

Equilibrium business cycles with idle resources and variable capacity utilization

Thomas F. Cooley

Equilibrium business cycles with idle resources and variable capacity utilization

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Published by Federal Reserve Bank of Philadelphia, Economic Research Division in Philadelphia .
Written in English


Edition Notes

StatementThomas F. Cooley, Gary D. Hansonand Edward C. Prescott.
SeriesEconomic research working paper series / Federal Reserve Bank of Philadelphia, Economic Research Division -- no.94-22, Economic research working paper (Federal Reserve Bank of Philadelphia, Economic Research Division) -- no.94-22.
ContributionsHanson, Gary D., Prescott, Edward C.
ID Numbers
Open LibraryOL21203266M

of the type of demand-driven business cycle model we propose is that changes in demand will variable capacity utilization model and, more generally, the neoclassical model, have a stark com- some resources would, in equilibrium, be idle even if prices are fully exible. The reason is that search is costly, so it would. This is a specific investigation of the importance of technological change specific to new investment goods for postwar U.S. aggregate fluctuations. A growth model that incorporates this form of technological change is calibrated to U.S. data and simulated, using the relative price of new equipment to identify the process driving investment-specific technology shocks.


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Equilibrium business cycles with idle resources and variable capacity utilization by Thomas F. Cooley Download PDF EPUB FB2

Equilibrium business cycles with idle resources and variable capacity utilization* Thomas F. Cooley1, Gary D. Hansen2, and Edward C.

Prescott3 1 Department of Economics, University of Rochester, Rochester, NYUSA 2 Equilibrium business cycles with idle resources and variable capacity utilization book of Economics, University of California, Los Angeles, Los Angeles, CAUSAFile Size: 1MB.

title = "Equilibrium business cycles with idle resources and variable capacity utilization", abstract = "A real business cycle economy is studied in which some capital is idle each period and the fraction of capital left idle varies in response to technology by:   Equilibrium business cycles with idle resources and variable capacity utilization.

Summary. A real business cycle economy is studied in which some capital is idle each period and the fraction of capital left idle varies in response to technology by: Thomas F. Cooley & Gary D. Hansen & Edward C. Prescott, "Equilibrium business cycles with idle resources and variable capacity utilization," Working PapersFederal Reserve Bank of Philadelphia, revised Economic growth and business cycles Frontiers of Business Cycle Research Equilibrium business cycles with idle resources and variable capacity utilization Jan Author: Tomoyuki Nakajima.

Equilibrium business cycles with idle resources and variable capacity utilization Thomas F. Cooley, Gary D. Hansen, Edward C. Prescott Pages Symposium. A variable capacity utilization allows for a good description of some of the main stylized facts of the Equilibrium business cycles with idle resources and variable capacity utilization book cycle, propagates and magnifies aggregate technological shocks and generates.

16 An essential assumption in Hayek’s explanation of business cycles is that they start from an equilibrium position with efficient utilization of resources.

Prices and Production (Hayek,34) is characterized by Hayek’s “conviction that if we want to explain economic phenomena at all, we have no means available but to build on the Cited by: 1.

Cooley, Thomas F & Hansen, Gary D & Prescott, Edward C, "Equilibrium Business Cycles with Idle Resources and Variable Capacity Utilization," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol.

6(1), pagesJune. Thomas F. Cooley & Gary D. Hansen & Edward C. Prescott, Firm Heterogeneity, Capacity Utilization, and the incorporating stronger propagation mechanisms into stylized business cycle models.

The presence of idle resources that can be readily engaged in pro- The macroeconomic equilibrium is characterized by a variable. A variable capacity utilization allows for a good description of some of the Equilibrium business cycles with idle resources and variable capacity utilization book stylized facts of the business cycle, propagates and magnifies aggregate technological shocks and generates endogenous persistence (i.e., the output growth rate displays positive serial correlation).Journal of Economic LiteratureClassification Numbers: E22, ECited by: Capacity utilization and market power.

Cooley, T., G. Hansen and E. Prescott,Equilibrium business cycles with idle resources and variable capacity utilization, Economic Theory.

de la Croix, D. and J.-F. Fagnart,Underemployment of production factors in a forward-looking model. Labour Economics 2, de la Croix, D. and by: Cooley, Thomas F, Hansen, Gary D and Prescott, Edward C (), "Equilibrium Business Cycles with Idle Resources and Variable Capacity Utilization," Economic Theory, 6 pp.

Cooley Thomas Equilibrium business cycles with idle resources and variable capacity utilization book, Ohanian Lee E (), "Postwar British Economic Growth and the Legacy of Keynes," Journal of Political Economy, (3), pp. Equilibrium business cycles with idle resources and variable capacity utilization Working Papers, Federal Reserve Bank of Philadelphia View citations (4) See also Journal Article in Economic Theory () Real returns on government debt: a general equilibrium quantitative exploration UC3M Working papers.

Economics, Universidad Carlos III de Madrid. We settle a relationship between capacity utilization and markups via the effect of capacity utilization rate changes on firms' market power.

We show that such a relationship influences significantly the short run response of the economy to exogenous shocks. Equilibrium Business Cycles with Idle Resources and Variable Capacity Utilization.

Equilibrium business cycles with idle resources and variable capacity utilization Working Papers, Federal Reserve Bank of Philadelphia View citations (4) See also Journal Article in Economic Theory () Financial Markets, Specialization, and Learning by Doing Working Papers, Rochester, Business - Quantitative Methods Working Paper Series.

An updated look at what Fischer Black's ideas on business cycles and equilibrium mean today. Throughout his career, Fischer Black described a view of business fluctuations based on the idea that a well-developed economy will be continually in by: "Equilibrium Business Cycles with Idle Resources and Variable Capacity Utilization," with Thomas F.

Cooley and Edward C. Prescott, Economic Theory. 6, Junepp. "Money and the Business Cycle," with Thomas F. Cooley, Chapter 7 of. Frontiers of Business Cycle Research, Thomas F. Cooley, editor, Princeton University Press, These delays create further decreases in aggregate demand, causing further reductions in prices, increased idle production capacity, increased unemployment, and reductions in wages and in lending and interest rates.

This cycle is called a deflationary spiral. If unchecked, it can have serious adverse consequence for an economy. Capacity utilization rate and the business cycle.

Posted on Decem The industrial capacity utilization rate is defined as the percentage of resources already installed or paid for by firms, such as capital and labor, actually used by corporations and factories to produce goods. This rate tends to move along with the business cycle.

In most manufacturing industries output is adjusted in a lumpy way along three margins: shiftwork, weekend work, and closing a plant temporarily down.

We incorporate such decisions into a dynamic general equilibrium model and study: (i) if such micro-level nonconvexities magnify business cycles; and (ii) if the aggregate effects of changes in firms' borrowing costs due to. This book presents a historical investigation of the theoretical development of contemporary Equilibrium Business Cycle Theory (EBCT).

The author examines the central features of the EBCT by tracing both the history of business cycle theory and the history of by: Equilibrium Business Cycles with Idle Resources and Variable Capacity Utilization (, with Thomas F.

Cooley) Needed: A Theory of Total Factor Productivity () Monopoly Rights: A Barrier to Riches (, with Stephen L. Parente) Malthus to Solow (, with Gary Duane Hansen) Barriers to Riches (, with Stephen L. Parente)Born: Equilibrium Business Cycles with Idle Resources and Variable Capacity Utilization.

by Cooley, Thomas F. & Hansen, Gary D. & Prescott, Edward C. Tests of an Adaptive Regression Model. by Cooley, Thomas F.

& Prescott, Edward C. Barriers to Technology Adoption and Development. by Parente, Stephen L. & Prescott, Edward C. Efficiency of the Natural. Working Paper File Downloads Abstract Views; Last month: 3 months: 12 months: Total: Last month: 3 months: 12 months: Total: A Unified Theory.

Equilibrium business cycles with idle resources and variable capacity utilization Cooley, T.; Hansen, G.; Prescott, E. Underemployment of production factors in a forward-looking model. Advanced Macroeconomic Theory I: Syllabus Equilibrium business cycles with idle resources and variable capacity utilization.

Economic Theory 6, 35– Cooley, T. F., R. Marimon, and V. Quadrini (). Aggregate consequences of limited. Equilibrium Business Cycles with Idle Resources and Variable Capacity Utilization | Economic Theory, 6(1): | With Thomas F.

Cooley and Gary D. Hansen Economic Growth and Business Cycles. 6 Aggregate resource constraints 7 Markets equilibrium condition 8 De–nition of equilibrium IRTS, or labour hoarding, or variable capacity utilization Evans (): money, interest rates and public spending Granger-cause SR University of Pavia Real Business Cycle Theory 37 / Created Date.

NBER Program(s):Economic Fluctuations and Growth Program The general equilibrium models in this paper, with complete markets, can give the major features of business cycles.

The models include real investment, but information is costless and is available to everyone at the same time. "Equilibrium Business Cycles with Idle Resources and Variable Capacity Utilization," with Thomas F.

Cooley and Edward C. Prescott, Economic Theory. 6, Junepp. Curriculum Vitae. page "Money and the Business Cycle," with Thomas F. Cooley, Chapter 7 of. "Equilibrium Business Cycles with Idle Resources and Variable Capacity Utilization," with Thomas F.

Cooley and Edward C. Prescott, Economic Theory 6, Junepp. "Money and the Business Cycle," with Thomas F. Cooley, Chapter 7 of Frontiers of Business Cycle Research, Thomas F. Cooley, editor, Princeton University Press, tion rate of an economy s capital stock the capacity utili - zation rate.

The capacity utilization rate is constructed as the percentage of resources (i.e., labor and capital) used by corporations and factories to produce enough finished goods to meet demand.

The figure plots U.S. capacity utilization at a quarterly frequency from Q1 Size: 92KB. Equilibrium Business Cycles with Idle Resources and Variable Capacity Utilization | Economic Theory, 6(1): | With Thomas F.

Cooley and Gary D. Hansen A real business cycle economy is studied in which some capital is idle each period and the fraction of capital left idle varies in response to technology shocks.

Data on the weekly operating time of capital improve the measurement of effective capital input in production. The production function of the French business sector is found to be consistent with a Cobb-Douglas technology under constant returns to scale.

Total factor productivity growth, estimated as an unobservable variable, has declined steadily since the late s, but more. Nobel-prize winning economist, Professor at Arizona State University, and economist at the Federal Reserve Bank of Minneapolis.

The collection contains drafts and published copies of Prescott's research papers and other writings, professional correspondence, files from speaking engagements and presentations, and teaching materials from his career at Carnegie-Mellon.

Equilibrium business cycles with idle resources and variable capacity utilization. Economic Theory 6, 35– Cooley, T. F., R.

Marimon, and V. Quadrini (). Aggregate consequences of limited contract enforceability. Unpublished manuscript.

Cooley, T. and V. Quadrini (). Monetary policy and the financial decision of Size: 68KB. Capacity constraints, asymmetries, and the business cycle Capacity constraints, asymmetries, and the business cycle Hansen, Gary D.; Prescott, Edward C.

We study how an occasionally binding capacity constraint affects the properties of business cycles. A real business cycle model is constructed where production takes place.

Investment, Capacity Utilization, and the Real Business Cycle By JEREMY GREENWOOD, Zvi HERCOWITZ, AND GREGORY W. HUFFMAN* This paper adopts Keynes' view that shocks to the marginal efficiency of invest-ment are important for business fluctuations, but incorporates it in a neoclassical framework with endogenous capacity utilization.

More recently, however, unemployment has dropped because new jobs have been created and the United States is closer to full employment. 3 Slow productivity may explain why capacity utilization is low while employment is recovering quickly.

Capacity utilization and employment tend to comove along the business cycle. Variable Factor Utilization and International Business Cycles Pdf Baxter, Dorsey Farr.

NBER Working Paper No. Issued in July NBER Program(s):Economic Fluctuations and Growth, International Finance and Macroeconomics, International Trade and Investment When an economic boom produces high output, employment, and investment in the United .Their combined citations are counted only for the first article.

Equilibrium business cycles with idle resources and variable capacity utilization. TF Cooley, GD Hansen, EC Prescott. Economic Theory 6 (1),Ebook utilization determines whether or ebook firms need to build new factories.

If capacity utilization is low, so that there is excess capacity, then current factories are not being used to their full potential, so there is not much sense in building new factories if there is still a lot of space in the old factories. As capacity utilization.