September 2015 Abstract The canonical neoclassical model is insufficient to understand business cycle fluctuations in emerging market and developing economies (EMDEs). I reformulate the models proposed by Aguiar and Gopinath (2007) and Neumeyer and Perri (2005) in simple settings that can be used to do back-of-the-envelope analysis and teach business cycle macroeconomics for EMDEs at the underg...

minants of potential growth, cyclical fluctuations in GDP and the contribution of the national economic policy of each of the three countries. High spending on research and development, particularly in information and communications technology, is identified as the main force driving growth in Sweden while a robust increase in private consumption resulting from rising asset prices is found to h...

This paper investigates business cycle relations among different economies in the Euro area. Cyclical dynamics are explicitly modelled as part of a time series model. We introduce mechanisms that allow for increasing or diminishing phase shifts and for time-varying association patterns in different cycles. Standard Kalman filter techniques are used to estimate the parameters simultaneously by m...

This paper examines two related models, which permit analytical investigation, to gain some insights into a relationship between endogenous growth and business cycle. Using two simple models which incorporate Fisher Black’s idea that a significant part of business cycle fluctuations is a consequence of an economy’s choice, we obtained a negative relationship between uncertainty and growth. Henc...

We previously studied equilibrium in a particularly simple world – an endowment economy. This was useful for getting intuition about what determined the real interest rate, but lacked realism. In this section we endogenize supply. The concept of equilibrium is identical to before, but the set up is more interesting. Now we have firms that produce output using capital and labor, and households t...

Self-Employment Dynamics Across the Business Cycle: Migrants Versus Natives Economically active people are either in gainful employment, are unemployed or selfemployed. We are interested in the dynamics of the transitions between these states across the business cycle. It is generally perceived that employment or self-employment are absorbing states. However, innovations, structural changes and...

We are motivated by four stylized facts computed for emerging and developed economies: (i) business cycle movements are wider in emerging countries; (ii) economies in emerging countries experience greater economic policy uncertainty; (iii) emerging economies are more polarized and less politically stable; and (iv) economic policy uncertainty is positively related to political polarization. We s...

_________________________________________________________________________ This paper reviews the role of micro non-convexities in the study of business cycles. One important nonconvexity arises because an individual can work only one workweek length in a given week. The implication of this non-convexity is that the aggregate intertemporal elasticity of labor supply is large and the principal ma...