EconPapers    
Economics at your fingertips  
 

Investment Specific Technology Shocks and International Business Cycles: An Empirical Assessment

Federico Mandelman (), Pau Rabanal (), Juan F Rubio-Ramirez () and Diego Vilan

Review of Economic Dynamics, 2011, vol. 14, issue 1, 136-155

Abstract: In this paper, we first introduce investment-specific technology (IST) shocks to an otherwise standard international real business cycle model and show that a thoughtful calibration of them along the lines of Raffo (2009) successfully addresses the "quantity", "international comovement", "Backus-Smith", and "price" puzzles. Second, we use OECD data for the relative price of investment to build and estimate these IST processes across the U.S and a "rest of the world" aggregate, showing that they are cointegrated and well represented by a vector error correction model (VECM). Finally, we demonstrate that when we fit such estimated IST processes in the model instead of the calibrated ones, the shocks are actually not as powerful to explain any of the four mentioned puzzles. (Copyright: Elsevier)

Keywords: International business cycles; Cointegration; Investment-specific technology shocks (search for similar items in EconPapers)
JEL-codes: E32 F32 F33 F41 (search for similar items in EconPapers)
Date: 2011
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (39) Track citations by RSS feed

Downloads: (external link)
http://dx.doi.org/10.1016/j.red.2010.08.001
Access to full texts is restricted to ScienceDirect subscribers and institutional members. See http://www.sciencedirect.com/ for details.

Related works:
Software Item: Code and data files for "Investment Specific Technology Shocks and International Business Cycles: An Empirical Assessment" (2010) Downloads
Working Paper: Investment-specific technology shocks and international business cycles: an empirical assessment (2010) Downloads
Working Paper: Investment; Specific Technology Shocks and International Business Cycles: An Empirical Assessment (2010) Downloads
Working Paper: Investment-Specific Technology Shocks and International Business Cycles: An Empirical Assessment (2010) 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:09-242

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

DOI: 10.1016/j.red.2010.08.001

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 2020-05-19
Handle: RePEc:red:issued:09-242