EconPapers    
Economics at your fingertips  
 

An application of business cycle accounting with misspecified wedges

Masaru Inaba and Kengo Nutahara

Review of Economic Dynamics, 2012, vol. 15, issue 2, 265-269

Abstract: It is often assumed that wedges evolve according to VAR(1) in the applications of business cycle accounting (BCA). However, recent research finds that the wedges have no VAR(1) representation in many dynamic stochastic general equilibrium (DSGE) economies, and that there might be a misspecification of the stochastic process of wedges. In order to assess the empirical usefulness of BCA, we apply BCA to a widely used medium-scale DSGE economy. Based on our experiments, we find that the accuracy of the measurement of wedges is high enough to capture the business cycle implications of wedges. (Copyright: Elsevier)

Keywords: Business cycle accounting; Misspecification (search for similar items in EconPapers)
JEL-codes: E10 E32 (search for similar items in EconPapers)
Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations View citations in EconPapers (2) Track citations by RSS feed

Downloads: (external link)
http://dx.doi.org/10.1016/j.red.2012.01.004
Access to full texts is restricted to ScienceDirect subscribers and institutional members. See http://www.sciencedirect.com/ for details.

Related works:
Software Item: Code files for "An application of business cycle accounting with misspecified wedges" (2012) Downloads
Working Paper: Online Appendices to "An application of business cycle accounting with misspecified wedges" (2012) Downloads
Working Paper: An Application of Business Cycle Accounting with Misspecified Wedges (2011) Downloads
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:red:issued:08-173

Ordering information: This journal article can be ordered from
https://www.economic ... ription-information/

Access Statistics for this article

Review of Economic Dynamics is currently edited by Jonathan Heathcote and Vincenzo Quadrini

More articles in Review of Economic Dynamics from Elsevier for the Society for Economic Dynamics Contact information at EDIRC.
Bibliographic data for series maintained by Christian Zimmermann ().

 
Page updated 2018-12-02
Handle: RePEc:red:issued:08-173