The Great Depression in Belgium from a Neo-Classical Perspective

Luca Pensieroso

No 2007025, Discussion Papers (ECON - Département des Sciences Economiques) from Université catholique de Louvain, Département des Sciences Economiques

Abstract: This paper casts the Belgian Great Depression of the 1930s within a dynamic stochastic general equilibrium (DSGE) framework. Results show that a total factor productivity shock within a standard real business cycle model is unsatisfactory. Introducing war expectations in the baseline model produces little improvement. Given the evidence on sticky wages put forward by historians, it shows that a simple DGSE model with sticky wages à la Taylor improves on the results.

Keywords: Great Depression; Belgium; sticky wages; dynamic stochastic general equilibrium (search for similar items in EconPapers)
JEL-codes: E13 N14 (search for similar items in EconPapers)
Pages: 66
Date: 2007-08-01
New Economics Papers: this item is included in nep-cba, nep-dge, nep-his and nep-mac
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http://sites.uclouvain.be/econ/DP/IRES/2007-25.pdf (application/pdf)

Related works:
Journal Article: The Great Depression in Belgium from a Neoclassical Perspective (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:ctl:louvec:2007025

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