The scarring effect of recessions

• 成果类型: Article
• 署名作者: Min Ouyang
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/j.jmoneco.2008.12.014
• 发表日期: 2009
• 页码: 184-199
• 关键词: Cleansing effect; Scarring effect; creative destruction; learning; demand shocks

摘要

According to the conventional view, recessions improve resource allocation by driving out less productive firms. This paper posits an additional scarring effect: recessions impede the developments of potentially superior firms by destroying them during their infancy. A model is developed to capture both the cleansing and the scarring effects. A key ingredient of the model is that idiosyncratic productivity is not directly observable, but can be learned over time. When calibrated with statistics on entry, exit and productivity differentials, the model suggests that the scarring effect dominates the cleansing effect, and gives rise to lower average productivity during recessions. (C) 2009 Elsevier B.V. All rights reserved.