Arbeitspapier

Productivity shocks and aggregate cycles in an estimated endogenous growth model

Using a two-sector endogenous growth model, this paper explores how productivity shocks in the goods and human capital producing sectors contribute to explaining aggregate cycles in output, consumption, investment and hours. To contextualize our findings, we also assess whether the human capital model or the standard real business cycle (RBC) model better explains the observed variation in these aggregates. We find that while neither of the workhorse growth models uniformly dominates the other across all variables and forecast horizons, the two-sector model provides a far better fit to the data. Some other key results are first, that Hicks-neutral shocks explain a greater share of output and consumption variation at shorter-forecast horizons whereas human capital productivity innovations dominate at longer ones. Second, the combined explanatory power of the two technology shocks in the human capital model is greater than the Hicks-neutral shock in the RBC model in the medium- and long-term for output and consumption. Finally, the RBC model outperforms the two-sector model with respect to explaining the observed variation in investment and hours.

Sprache
Englisch

Erschienen in
Series: CESifo Working Paper ; No. 2672

Klassifikation
Wirtschaft
Bayesian Analysis: General
Model Evaluation, Validation, and Selection
Business Fluctuations; Cycles
Thema
endogenous growth
human capital
real business cycles
Bayesian estimation
VAR errors
Neue Wachstumstheorie
Humankapital
Real Business Cycle
Bayes-Statistik
VAR-Modell
Modell-Spezifikation
Theorie

Ereignis
Geistige Schöpfung
(wer)
Malley, Jim
Woitek, Ulrich
Ereignis
Veröffentlichung
(wer)
Center for Economic Studies and ifo Institute (CESifo)
(wo)
Munich
(wann)
2009

Handle
Letzte Aktualisierung
10.03.2025, 11:44 MEZ

Datenpartner

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ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.

Objekttyp

  • Arbeitspapier

Beteiligte

  • Malley, Jim
  • Woitek, Ulrich
  • Center for Economic Studies and ifo Institute (CESifo)

Entstanden

  • 2009

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