Nonconvex factor adjustments in equilibrium business cycle models: do nonlinearities matter?

• 成果类型: Article
• 署名作者: Khan, A; Thomas, JK
• 署名单位: Federal Reserve System - USA; Federal Reserve Bank - Philadelphia; University of Minnesota System; University of Minnesota Twin Cities; Federal Reserve System - USA; Federal Reserve Bank - Minneapolis
• 刊物名称: JOURNAL OF MONETARY ECONOMICS
• ISSN/ISSBN: 0304-3932
• DOI: 10.1016/S0304-3932(03)00003-5
• 发表日期: 2003
• 页码: 331-360
• 关键词: Lumpy investment; adjustment costs; business cycles; nonlinearities

摘要

Recent empirical analysis has found nonlinearities to be important in understanding aggregated investment. Using an equilibrium business cycle model, we search for aggregate nonlinearities arising from the introduction of nonconvex capital adjustment costs. We find that, while such costs lead to nontrivial nonlinearities in aggregate investment demand, equilibrium investment is effectively unchanged. Our finding, based on a model in which aggregate fluctuations arise through exogenous changes in total factor productivity, is robust to the introduction of shocks to the relative price of investment goods. (C) 2003 Elsevier Science B.V. All rights reserved.