Firm dynamics, markup variations, and the business cycle

• 成果类型: Article
• 署名作者: Jaimovich, Nir; Floetotto, Max
• 署名单位: Stanford University; National Bureau of Economic Research
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/j.jmoneco.2008.08.008
• 发表日期: 2008
• 页码: 1238-1252
• 关键词: productivity; business cycles; firm dynamics; markups

摘要

We present a model in which net business formation is endogenously procyclical. Variations in the number of operating firms lead to countercyclical variations in markups that give rise to endogenous procyclical movements in measured total factor productivity (TFP). Based oil this result, the paper suggests a simple structural decomposition of variations in TFP into those originating from exogenous shocks and those originating endogenously from the interaction between firms' entry and exit decisions and the degree of competition. The decomposition suggests that around 40% of the movements in measured TFP can be attributed to this interaction. Moreover, the paper analyzes the effects on (i) the measurement of the volatility of exogenous shocks in the U.S. economy and (ii) the magnification of shocks over the business cycle. (C) 2008 Elsevier B.V. All rights reserved.