Reexamining the Cyclical Behavior of the Relative Price of Investment

Franck Portier, Paul Beaudry and Alban Moura

No 10128, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: We document the cyclical behavior of several measures of the relative price of investment goods for the U.S. economy over the last fifty years. Our main result is that there is no robust evidence that this relative price is countercyclical in the data. Furthermore, for the recent (post-Volcker) period, the relative price of investment appears predominantly procyclical. When looking at more disaggregated series, most measures are procyclical, a few acyclical, and only the price of equipment is countercyclical for some periods and measures. The procyclical behavior of the relative price of aggregate investment is also found for the six other countries of the G7.

Keywords: Business cycles; Relative price of investment (search for similar items in EconPapers)
JEL-codes: E3 (search for similar items in EconPapers)
Date: 2014-09
New Economics Papers: this item is included in nep-mac
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Citations: View citations in EconPapers (3)

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Related works:
Journal Article: Reexamining the cyclical behavior of the relative price of investment (2015)
Working Paper: Reexamining the cyclical behavior of the relative price of investment (2015)
Working Paper: Reexamining the Cyclical Behavior of the Relative Price of Investment (2014)
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