Do Business Cycles Cast Long Shadows? Short-Run Persistence and Economic Growth

Antonio Fatas

Journal of Economic Growth, 2000, vol. 5, issue 2, 147-62

Abstract: This article explores the links between cyclical fluctuations and long-run growth in the context of an endogenous growth model with aggregate demand externalities. In this model, aggregate demand and growth rates are positively correlated. In the presence of exogenous cyclical shocks, the model is able to generate persistent fluctuations through the effects that business cycles have on aggregate demand, profits and technological progress. Persistence becomes a measure of the response to business cycles of growth-related variables. Empirical evidence from a large sample of countries suggests that there is indeed a correlation between how persistent fluctuations are and the long-term growth rates of GDP. Copyright 2000 by Kluwer Academic Publishers

Date: 2000
References: Add references at CitEc
Citations: View citations in EconPapers (89)

Downloads: (external link)
http://journals.kluweronline.com/issn/1381-4338/contents link to full text (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:kap:jecgro:v:5:y:2000:i:2:p:147-62

Ordering information: This journal article can be ordered from
http://www.springer. ... th/journal/10887/PS2

Access Statistics for this article

Journal of Economic Growth is currently edited by Oded Galor

More articles in Journal of Economic Growth from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().