International business cycles and the relative price of investment goods

Article, Preprint OPEN
Parantap Basu; Christoph Thoenissen;
  • Journal: Canadian Journal of Economics,volume 44,issue 2 May,pages580-606
  • Subject: Investment frictions, investment specific technological progress, total factor productivity, relative price of investment goods terms of trade
    • jel: jel:E32 | jel:F41 | jel:E22

Is the relative price of investment goods a good proxy for investment frictions? We model this relative price in a flexible price international economy with two fundamental shocks, namely the total factor productivity (TFP) shock and the investment specific technology (... View more
  • References (13)
    13 references, page 1 of 2

    [1] Backus, D., Kehoe, P. and Kydland, F. (1994). Dynamics of the trade balance and the terms of trade: the J -curve. American Economic Review 84, pages 84-103.

    [2] Benigno, G. and Thoenissen, C. (2008). Consumption and real exchange rates with incomplete markets and non-traded goods. Journal of International Money and Finance, vol. 27, pages 926 - 948.

    [5] Chari, V. V., Kehoe, P. J. and McGrattan, E. R. (2005), Business cycle accounting, Econometrica, vol 75, no. 3, pages 781-836.

    [6] Christiano, L., Eichenbaum, M. and Evans, C. (2005), Nominal rigidities and the dynamic e¤ects of a shock to monetary policy, Journal of Political Economy, Vol. 113 (1), pages 1 - 45.

    [7] Corsetti, G. Dedola, L. and Leduc. S. (2008). International risk sharing and the transmission of productivity shocks. Review of Economic Studies, vol. 75. pages 443 - 473.

    [8] Enders, Z. and Müller, G.J. (2007). On the international transmission of technology shocks, mimeo, University of Frankfurt.

    [11] Heathcote, J. and Perri, F. (2002). Financial autrarky and international business cycles. Journal of Monetary Economics, vol. 49, pages 601-27.

    [12] Justiniano, A., Primiceri, G. and Tambalotti, A. (2009), Investment shocks and the relative price of investment. Mimeo, Northwestern University.

    [13] King, R. and Watson, M. (1998). The solution of singular linear di¤erence systems under rational expectations. International Economic Review, Vol. 39, No. 4, pages 1015-26.

    [14] Liu, Z., Waggoner, D. and Zha, T. (2009). Sources of the great moderation: shocks, friction, or monetary policy? Federal Reserve Bank of San Francisco Working Paper no. 2009-01.

  • Related Organizations (5)
  • Metrics
Share - Bookmark