Bayesian estimation and sources of aggregate fluctuations

What’s News in Business Cycles

JEL codes: 
C11, C51, E13, E32
Version Date: 
Feb 2009

In this paper, we perform a structural Bayesian estimation of the contribution of anticipated shocks to business cycles in the postwar United States. Our theoretical framework is a real-business-cycle model augmented with four real rigidities: investment adjustment costs, variable capacity utilization, habit formation in consumption, and habit formation in leisure.

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