Debunking the granular origins of aggregate fluctuations: from real business cycles back to Keynes
Giovanni Dosi (),
Mauro Napoletano (),
Andrea Roventini and
Tania Treibich ()
Sciences Po publications from Sciences Po
In this work we study the granular origins of business cycles and their possible underlying drivers. As shown by Gabaix (Econometrica 79:733–772, 2011), the skewed nature of firm size distributions implies that idiosyncratic (and independent) firm-level shocks may account for a significant portion of aggregate volatility. Yet, we question the original view grounded on “supply granularity”, as proxied by productivity growth shocks – in line with the Real Business Cycle framework–, and we provide empirical evidence of a “demand granularity”, based on investment growth shocks instead. The role of demand in explaining aggregate fluctuations is further corroborated by means of a macroeconomic Agent-Based Model of the “Schumpeter meeting Keynes” family Dosi et al. (J Econ Dyn Control 52:166–189, 2015). Indeed, the investigation of the possible microfoundation of RBC has led us to the identification of a sort of microfounded Keynesian multiplier.
Keywords: Business cycles; Granular residual; Granularity hypothesis; Agent-based models; Firm dynamics; Productivity growth; Investment growth (search for similar items in EconPapers)
JEL-codes: C63 E12 E22 E32 O4 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-bec, nep-cmp, nep-hme, nep-mac, nep-ore, nep-pke and nep-tid
References: Add references at CitEc
Citations: Track citations by RSS feed
Published in Journal of Evolutionary Economics, 2019, vol. 29, pp.67-90
Downloads: (external link)
https://spire.sciencespo.fr/hdl:/2441/1p3k1810c89k ... egates-gdosi.pdf.pdf (application/pdf)
Journal Article: Debunking the granular origins of aggregate fluctuations: from real business cycles back to Keynes (2019)
Working Paper: Debunking the granular origins of aggregate fluctuations: from real business cycles back to Keynes (2019)
Working Paper: The Debunking the Granular origins of Aggregate fluctuations: from real Business Cycles back to Keynes (2018)
Working Paper: The Debunking the Granular Origins of Aggregate Fluctuations: From Real Business Cycles back to Keynes (2018)
Working Paper: Debunking the Granular Origins of Aggregate Fluctuations: From Real Business Cycles back to Keynes (2018)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:spo:wpmain:info:hdl:2441/1p3k1810c89k3b4gg6n2nuc0m4
Access Statistics for this paper
More papers in Sciences Po publications from Sciences Po Contact information at EDIRC.
Bibliographic data for series maintained by Spire @ Sciences Po Library ().