Asymmetry Reversals and the Business Cycle

Roberta Distante, Ivan Petrella and Emiliano Santoro

No 151531, Economy and Society from Fondazione Eni Enrico Mattei (FEEM)

Abstract: The cross-sectional dynamics of the U.S. business cycle is examined through the lens of quantile regression models. Conditioning the quantiles of firm-level growth to different measures of technological change highlights a deep connection between counter-cyclical skewness and the transmission of aggregate disturbances. Asymmetry reversals emerge as the dominant source of cyclical variation in the probability density, generating a powerful amplification of aggregate shocks to firm technology. Designing and validating heterogeneous firm business cycle models should necessarily account for this empirical finding.

Keywords: Industrial; Organization (search for similar items in EconPapers)
Pages: 29
Date: 2013-05
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Citations: View citations in EconPapers (3)

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Working Paper: Asymmetry Reversals and the Business Cycle (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:ags:feemso:151531

DOI: 10.22004/ag.econ.151531

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