Technology Shocks and Aggregate Fluctuations: How Well Does the RBC Model Fit Postwar U.S. Data?

Author/Editor:

Jordi Gali Garreta ; Pau Rabanal

Publication Date:

December 1, 2004

Electronic Access:

Free Download. Use the free Adobe Acrobat Reader to view this PDF file

Disclaimer: This Working Paper should not be reported as representing the views of the IMF.The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate

Summary:

Our answer: Not so well. We reached that conclusion after reviewing recent research on the role of technology as a source of economic fluctuations. The bulk of the evidence suggests a limited role for aggregate technology shocks, pointing instead to demand factors as the main force behind the strong positive comovement between output and labor input measures.

Series:

Working Paper No. 2004/234

Subject:

Business cycles Economic growth Labor Labor productivity Prices Production Sticky prices Technology

English

Publication Date:

December 1, 2004

ISBN/ISSN:

9781451875652/1018-5941

Stock No:

WPIEA2342004

Pages:

67

Please address any questions about this title to publications@imf.org