Technology Shocks and Hours Revisited: Evidence from Household Data
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Hikaru Saijo: University of California, Santa Cruz
Review of Economic Dynamics, 2019, vol. 31, 347-362
I exploit heterogeneous impulse responses at the household level due to limited stock market participation to provide novel evidence on the degree of nominal rigidities. A number of studies show that positive technology shocks reduce aggregate hours. The finding is often interpreted as evidence in favor of sticky prices. Using the Consumer Expenditure Survey, I show that, while non-stockholders reduce hours in response to a positive technology shock, stockholders increase them. Aggregate hours fall because most households are non-stockholders. This finding is inconsistent with models featuring a high degree of nominal rigidities. (Copyright: Elsevier)
Keywords: Limited stock participation; Nominal rigidity; Technology shock (search for similar items in EconPapers)
JEL-codes: E24 E32 (search for similar items in EconPapers)
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