Free entry and business cycles under the influence of animal spirits

• 成果类型: Article
• 署名作者: Ferreira, RD; Dufourt, F
• 署名单位: Universites de Strasbourg Etablissements Associes; Universite de Strasbourg
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/j.jmoneco.2004.12.003
• 发表日期: 2006
• 页码: 311-328
• 关键词: business cycles; animal spirits; imperfect competition

摘要

We provide a business cycle model in which endogenous markup fluctuations are the main driving force. These fluctuations occur due to some form of 'animal spirits', impelling firms in their entry-exit decisions within each sector. By contrast to existing models of the business cycle emphasizing the role of animal spirits, we do not rely on the sink property of the equilibrium to generate indeterminacy. Hence, while our model does pretty well in accounting for the main features of US business cycles, it avoids several criticisms addressed to these former models, concerning either their dependence upon strongly increasing returns, too high markups, or their implication of countercyclical movements of consumption. (c) 2005 Elsevier B.V. All rights reserved.