Polarized business cycles

• 成果类型: Article
• 署名作者: Azzimonti, Marina; Talbert, Matthew
• 署名单位: Federal Reserve System - USA; Federal Reserve Bank - Philadelphia; University of Texas System; University of Texas Austin
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/j.jmoneco.2014.07.001
• 发表日期: 2014
• 页码: 47-61
• 关键词: Real business cycle; Economic policy uncertainty; polarization; Political stability; time consistency

摘要

Four stylized facts motivate this paper: (i) business cycle movements are wider in emerging countries (EC) than in developed ones; (ii) EC experience greater economic policy uncertainty; (iii) EC are more polarized and less politically stable; and (iv) EPU is positively related to political polarization. A standard real business cycle model augmented to incorporate political polarization, a 'polarized business cycle' (PBC) model, is shown to be consistent with these facts. We first derive our results analytically, and then quantify the effects of a permanent increase in polarization to the US economy. (C) 2014 Elsevier B.V. All rights reserved.