Arbeitspapier
Endogenous firm entry in an estimated model of the U.S. business cycle
A recent theoretical literature highlights the role of endogenous firm entry as an internal amplification mechanism of business cycle fluctuations. The amplification mechanism works through the competition and the variety effect. This paper tests the significance of this amplification mechanism, quantifies its importance, and disentangles the competition and the variety effect. To this end, we estimate a medium-scale real business cycle model with firm entry for the U.S. economy. The parameter governing the competition and variety effect is estimated to be statistically significant. We find that firm entry substantially amplifies output by 8.5 percent. The competition effect accounts for most amplification, whereas the variety effect only plays a minor role.
- Sprache
-
Englisch
- Erschienen in
-
Series: Economics Working Paper ; No. 2014-01
- Klassifikation
-
Wirtschaft
Consumption, Saving, Production, Investment, Labor Markets, and Informal Economy: General (includes Measurement and Data)
Business Fluctuations; Cycles
- Thema
-
Bayesian estimation
Business Cycles
Competition Effect
Entry
Mark-ups
Variety Effect
- Ereignis
-
Geistige Schöpfung
- (wer)
-
Offick, Sven
Winkler, Roland C.
- Ereignis
-
Veröffentlichung
- (wer)
-
Kiel University, Department of Economics
- (wo)
-
Kiel
- (wann)
-
2014
- Handle
- Letzte Aktualisierung
-
10.03.2025, 11:42 MEZ
Datenpartner
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.
Objekttyp
- Arbeitspapier
Beteiligte
- Offick, Sven
- Winkler, Roland C.
- Kiel University, Department of Economics
Entstanden
- 2014
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