Hostname: page-component-cd9895bd7-hc48f Total loading time: 0 Render date: 2024-12-23T13:50:59.940Z Has data issue: false hasContentIssue false
  • English
  • Français

BUSINESS CYCLE ACCOUNTING FOR CHILE

Published online by Cambridge University Press:  06 February 2014

Ina Simonovska  and
Ludvig Söderling
Ina Simonovska*
Affiliation:
University of California, Davis and NBER
Ludvig Söderling
Affiliation:
International Monetary Fund
*
Address correspondence to: Ina Simonovska, Department of Economics, University of California, Davis, One Shields Avenue, Davis, CA 95616, USA; e-mail: inasimonovska@ucdavis.edu.
Get access Rights & Permissions [Opens in a new window]

Abstract

We investigate sources of economic fluctuations in Chile during 1998–2007 within the framework of a standard neoclassical growth model with time-varying frictions (wedges). We analyze the relative importance of efficiency, labor, investment, and government/trade wedges for business cycles in Chile. The purpose of this exercise is twofold: (i) focusing the policy discussion on the most important wedges in the economy and (ii) identifying which broad class of models would present fruitful avenues for further research. We find that different wedges have played different roles during our studied period, but that the efficiency, labor, and investment wedges have had the greatest impact. We also compare our results with existing studies on emerging and developed economies.

Keywords

Business Cycle AccountingWedgesChile
Type
Articles
Information
Macroeconomic Dynamics , Volume 19 , Issue 5 , July 2015 , pp. 990 - 1022
Copyright
Copyright © Cambridge University Press 2014 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

REFERENCES

Bergoeing, R., Kehoe, P.J., Kehoe, T.J., and Soto, R. (2002a) A decade lost and found: Mexico and Chile in the 1980s. Review of Economic Dynamics 5, 166–205.CrossRefGoogle Scholar
Bergoeing, R., Kehoe, P.J., Kehoe, T.J., and Soto, R. (2002b) Decades lost and found: Mexico and Chile since 1980. Minneapolis Quarterly Review 26 (1), 3–30.Google Scholar
Bergoeing, R., Kehoe, P.J., Kehoe, T.J., and Soto, R. (2002c) Policy-driven productivity in Chile and Mexico in the 1980's and 1990's. American Economic Review 92, 16–21.CrossRefGoogle Scholar
Chakraborty, S. (2009a) Modeling sudden stops: The nontrivial role of preference specifications. Economics Letters 104, 1–4.CrossRefGoogle Scholar
Chakraborty, S. (2009b) The boom and the bust of the Japanese economy: A quantitative look at the period 1980–2000. Japan and the World Economy 21, 116–131.CrossRefGoogle Scholar
Chari, V.V., Kehoe, P.J., and McGrattan, E.R. (2005) Sudden stops and output drops. American Economic Review 95, 381–387.CrossRefGoogle Scholar
Chari, V.V., Kehoe, P.J., and McGrattan, E.R. (2006) Appendices: Business Cycle Accounting. Staff report 362, Research Department, Federal Reserve Bank of Minneapolis.CrossRefGoogle Scholar
Chari, V.V., Kehoe, P.J., and McGrattan, E.R. (2007a) Business cycle accounting. Econometrica 75, 781–836.CrossRefGoogle Scholar
Chari, V.V., Kehoe, P.J., and McGrattan, E.R. (2007b) Comparing Alternative Representations, Methodologies, and Decompositions in Business Cycle Accounting. Staff report 384, Research Department, Federal Reserve Bank of Minneapolis.CrossRefGoogle Scholar
Christiano, L.J. and Davis, J.M. (2006) Two Flaws In Business Cycle Accounting. NBER working paper 12647, National Bureau of Economic Research.CrossRefGoogle Scholar
Edwards, S., Edwards, A.C., Bentolila, S., and Gali, J. (2000) Economic reforms and labour markets: Policy issues and lessons from Chile. Economic Policy 15, 181–229.CrossRefGoogle Scholar
Gollin, D. (2002) Getting income shares right. Journal of Political Economy 110 (2).CrossRefGoogle Scholar
Graminho, F. M. (2006) A Neoclassical Analysis of the Brazilian “Lost-Decades.” Working paper 123, Central Bank of Brazil, Research Department.Google Scholar
Greenwood, J., Hercowitz, Z., and Huffman, G.W. (1988) Investment, capacity utilization, and the real business cycle. American Economic Review 78, 402–417.Google Scholar
Kersting, E.K. (2008) The 1980s recession in the UK: A business cycle accounting perspective. Review of Economic Dynamics 11, 179–191.CrossRefGoogle Scholar
Kobayashi, K. and Inaba, M. (2006) Business cycle accounting for the Japanese economy. Japan and the World Economy 18, 418–440.CrossRefGoogle Scholar
Lama, R. (2011) Accounting for output drops in Latin America. Review of Economic Dynamics 14, 295–316.CrossRefGoogle Scholar
Livacic, E. and Saez, S. (2001) The banking supervision agenda in Latin America. CEPAL Review 74, 119–131.CrossRefGoogle Scholar
OECD (2009) OECD Reviews of Labour Market and Social Policies: Chile. Paris: OECD.Google Scholar
Schmitt-Grohe, S. and Uribe, M. (2003) Closing small open economy models. Journal of International Economics 61, 163–185.CrossRefGoogle Scholar
Šustek, R. (2011) Monetary business cycle accounting. Review of Economic Dynamics 14, 592–612.CrossRefGoogle Scholar