Discussion of "The source of historical economic fluctuations: An analysis using long-run restrictions" by Neville Francis and Valerie A. Ramey

Harald Uhlig ()

No 2006-042, SFB 649 Discussion Papers from Humboldt University Berlin, Collaborative Research Center 649: Economic Risk

Abstract: This paper discusses the paper The Source of Historical Economic Fluctuations: An Analysis using Long-Run Restrictions by Neville Francis and Valerie A. Ramey. It argues that these authors have made great progress both in the precise measurement of labor input as well as determining the effect of productivity shocks on labor, but a number of questions remain. As for measurement, the issue of schooling needs further work. As for calculating the long-run impact of labor productivity shocks, unreasonable results emerge for the response of the capital stock, if included in the VAR. Using medium-term identification delivers more reasonable results.

Keywords: technological progress; business cycles; hours worked; labor productivity; vector autoregressions; identification; long-run restrictions; medium-run restrictions (search for similar items in EconPapers)
JEL-codes: C32 E22 E23 E24 E32 (search for similar items in EconPapers)
Date: 2006
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:sfb649:sfb649dp2006-042

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