Dynamic Complementarities: A Quantitative Analysis

Russell Cooper and Alok Johri

No 5691, NBER Working Papers from National Bureau of Economic Research, Inc

Abstract: This paper considers the importance of dynamic complementarities as an endogenous source of propagation in a dynamic stochastic economy. Dynamic complementarities link the stocks of human and organizational capital, which are influenced by past levels of economic activity, to current levels of productivity. We supplement an otherwise standard dynamic business cycle model with both contemporaneous and dynamic complementarities. The model is calibrated using estimates of these effects. Our quantitative analysis identifies empirically relevant dynamic complementarities as a source of propagation for both technology and taste shocks.

JEL-codes: E23 E32 (search for similar items in EconPapers)
Date: 1996-07
Note: EFG
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Citations: View citations in EconPapers (5)

Published as Cooper, Russel W. and Alok Johri. "Dynamic Complementarities: A Quantitative Analysis," Journal of Monetary Economics, 1997, v40(1,Sep), 97-119.

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