Real Business Cycles in Emerging Countries?

Javier García-Cicco, Roberto Pancrazi and Martín Uribe ()
Authors registered in the RePEc Author Service: Javier Garcia Cicco

No 12629, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: We use more than one century of Argentine and Mexican data to estimate the structural parameters of a small-open-economy real-business-cycle model driven by nonstationary productivity shocks. We find that the RBC model does a poor job at explaining business cycles in emerging countries. We then estimate an augmented model that incorporates shocks to the country premium and financial frictions. We find that the estimated financial-friction model provides a remarkably good account of business cycles in emerging markets and, importantly, assigns a negligible role to nonstationary productivity shocks.

JEL-codes: F41 (search for similar items in EconPapers)
Date: 2006-10
New Economics Papers: this item is included in nep-dge and nep-mac
Note: EFG IFM
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Citations: View citations in EconPapers (22)

Published as Garciaa-Cicco, Javier, Roberto Pancrazi, and Martín Uribe. “Real Business Cycles in Emerging Countries?" American Economic Review 100, 5 (December 2010): 2510-2531.

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Journal Article: Real Business Cycles in Emerging Countries? (2010)
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