Variable capital utilization and international business cycles

• 成果类型: Article
• 署名作者: Baxter, M; Farr, DD
• 署名单位: Boston University; National Bureau of Economic Research
• 刊物名称: JOURNAL OF INTERNATIONAL ECONOMICS
• ISSN/ISSBN: 0022-1996
• DOI: 10.1016/j.jinteco.2004.01.004
• 发表日期: 2005
• 页码: 335-347
• 关键词: International business cycles; Utilization; transmission; PRODUCTIVITY; neoclassical

摘要

This paper develops a two-country international business-cycle model with variable capital utilization, using a standard depreciation-in-use technology. Variable capital utilization significantly reduces the required size of productivity shocks needed to replicate observed output volatility by 20-40%. Further, the model generates positive comovement across countries in wages, hours, and investment, while preserving empirically accurate predictions regarding the relative cross-country correlations of output and consumption and the countercyclical behavior of net exports. Finally, accounting for variable capital utilization reduces cross-country correlation of true productivity shocks relative to that of the standard Solow residual. (c) 2004 Published by Elsevier B.V.