The labor market in real business cycle theory

Gary Hansen and Randall Wright

Quarterly Review, 1992, vol. 16, issue Spr, 2-12

Abstract: The standard real business cycle model fails to adequately account for two facts found in the U.S. data: the fact that hours worked fluctuate considerably more than productivity and the fact that the correlation between hours worked and productivity is close to zero. In this paper, in a unified framework, the authors describe and analyze four extensions of the standard model, by introducing nonseparable leisure, indivisible labor, government spending, and household production.

Keywords: Labor market; Business cycles (search for similar items in EconPapers)
Date: 1992
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Citations: View citations in EconPapers (66)

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