Download or read book Firm Heterogeneity in Macroeconomics written by Allen Tran and published by . This book was released on 2014 with total page 141 pages. Available in PDF, EPUB and Kindle. Book excerpt: Macroeconomic models are often estimated with aggregate data, aligning the aggregated behavior of firms and households in models to the data. However, using aggregate data alone can overlook important details of firm behavior that are crucial for understanding issues in macroeconomics. In this dissertation, I use data on firms at the micro-level to more accurately capture firms behavior and their interactions with one another. This approach is applied to answer questions that relate to the monetary policy transmission mechanism, economic growth from new entrants and welfare gains from new technology. A substantial literature exists which suggests that imperfect information across firms is capable of generating large monetary non-neutralities. In Chapter One, the level of imperfect information is taken from micro-data and used to discipline a standard menu cost model augmented with information frictions. In the model, imperfect information has a negligible effect and real responses to a monetary shock are small and transient in contrast to the bulk of the imperfect information literature. The selection effect dominates the effects of imperfect information as the level of dispersion in inflation expectations in the data is tiny. This result still holds even when the level of dispersion is set to that of the maximal observed levels of dispersion. Chapter Two presents data that suggests new entering establishments compete for customers, rather than inputs in order to grow. Consistent with the data, I present a model where customers satisfice in forming relationships with establishments in the presence of search frictions. The extent of these search frictions is a new margin that affects selection and allocative efficiency. As search becomes less random and more directed, customers are less willing to satisfice, improving allocative efficiency and inducing exit of slower growing firms. When search frictions in product markets are increased to match establishment dynamics in Chile, output falls by roughly 14 per cent relative to the model calibrated to the US, reflecting decreased allocative efficiency. Chapter Three studies the impact of online retail on aggregate welfare. I develop a new measure of store level retail productivity and with a spatial model, calculate each store's equilibrium response to increased competitive pressure from online retailers. From counterfactual exercises mimicking improvements in shipping and increased internet access, I estimate that improvements in online retail increased aggregate welfare from retail activities by 13.4 per cent. Roughly two-thirds of the increase can be attributed to welfare improvements holding fixed market shares, with the remainder due to reallocation. Surprisingly, 8.2 percent of firms actually benefit as they absorb market share from closed stores. Finally, I estimate that the proposed Marketplace Fairness Act would claw back roughly one-third of sales that would otherwise have gone to online retailers between 2007-12.

Download or read book Essays on Firm Heterogeneity and Macroeconomic Dynamics written by Roberto Naim Jorge Fattal Jaef and published by . This book was released on 2011 with total page 252 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Heterogeneity in Macroeconomics and its Implications for Monetary Policy written by Fabian Schnell and published by Springer. This book was released on 2015-04-28 with total page 180 pages. Available in PDF, EPUB and Kindle. Book excerpt: Fabian Schnell develops a model indicating that by keeping real interest rates too low, monetary policy can distort the allocation of resources across firms and potentially delay economic recovery after a recession. This is a new channel of monetary policy that is especially relevant in view of “Quantitative Easing” programs. A second model focuses on the short-term implications of heterogeneously productive firms, showing an acceleration effect of technology shocks. Finally, an empirical investigation of firms’ price-setting behaviors shows that time-dependent factors, relative to state-dependent ones, play a small role with respect to the probability and the size of a price change. All results provide new insights for monetary policy.

Download or read book Comparative Advantage and Heterogeneous Firms written by Andrew B. Bernard and published by . This book was released on 2006 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper examines how country, industry and firm characteristics interact in general equilibrium to determine nations' responses to trade liberalization. When firms possess heterogeneous productivity, countries differ in relative factor abundance and industries vary in factor intensity, falling trade costs induce reallocations of resources both within and across industries and countries. These reallocations generate substantial job turnover in all sectors, spur relatively more creative destruction in comparative advantage industries than comparative disadvantage industries, and magnify ex ante comparative advantage to create additional welfare gains from trade. The relative ascendance of high-productivity firms within industries boosts aggregate productivity and drives down consumer prices. In contrast with the neoclassical model, these price declines dampen and can even reverse the real wage losses of scarce factors as countries liberalize.

Download or read book Firm Heterogeneity and the Macroeconomy written by and published by . This book was released on 2014 with total page 126 pages. Available in PDF, EPUB and Kindle. Book excerpt: The three chapters of this thesis contribute to a literature which emphasizes the importance of microeconomic heterogeneity for macroeconomic outcomes. In my work I focus on firm heterogeneity. I investigate the US labor market implications of a drop in the number of new firms, study the cyclical effects on productivity due to limits in the reallocation of capital across firms, and quantify the effectiveness of a policy which attempted to save jobs in Germany by altering firm incentives for lay-offs. The first chapter of this thesis investigates the role of new firms ('start-ups') in the US labor market. Start-ups and young firms grow faster and create more net jobs than older, incumbent firms. Yet since 2007 the number of start-ups in the US has declined by over 20%, accounting for a large part of the persistently high unemployment rate. I claim that this fact is related to the unprecedented fall in the value of real estate. Based on the empirical evidence I construct a model that captures the idea that start-ups require external financing, for which real estate is used as collateral. I calibrate and compute a quantitative competitive industry model with endogenous entry and exit, firm heterogeneity, labor adjustment costs, and aggregate shocks. It generates a 'jobless recovery' similar to what we observed in the US in the aftermath of the 2007-09 recession and is able to explain over 80% of the increase and persistence in unemployment since the recession. The second chapter, joint work with Russell Cooper, studies the productivity implications of frictions in the reallocation of factors. Recent empirical work has shown that misallocation of factors can have sizeable effects on the levels of aggregate output and productivity. We are interested in the question whether these frictions can also produce important cyclical movements. We find that the effects are quantitatively important in the presence of fluctuations in adjustment frictions and/or the cross sectional variation of profitability shocks. These fluctuations depend on higher order moments of the joint distribution of capital and plant-level productivity rather than mean values alone. Even without aggregate productivity shocks, the model has quantitative properties that resemble those of a standard stochastic growth model and match important facts about the cyclicality of reallocation and firm productivity dispersion. The last chapter, joint work with Russell Cooper and Moritz Meyer, studies the employment and productivity implications of short-time work ('Kurzarbeit') in Germany. During the years 2009-10 this policy was intended to provide incentives for firms to adjust labor input by reducing hours per worker instead of firing workers. Using confidential German firm micro data we estimate a model of costly labor adjustment. We use the estimated model to simulate the effects of the policy during the recent recession, trying to quantify in how far the German short-time work scheme reduced the allocative efficiency of the German labor market.

Download or read book Essays on Macroeconomics Monetary Policy and Firm Heterogeneity written by Claire Thürwächter and published by . This book was released on 2023 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Firms in the International Economy written by Sjoerd Beugelsdijk and published by MIT Press. This book was released on 2013-12-13 with total page 441 pages. Available in PDF, EPUB and Kindle. Book excerpt: Essays by leading scholars suggest that insights from international business could enrich firm heterogeneity research in international economics. Despite their common roots, international economics (IE) and international business (IB) have developed into two distinct fields of study. Economists have directed their efforts at formalizing the workings of international trade and investment at the macroeconomic level; business scholars have relied more on data-driven conceptual narratives than mathematical tools. But the recent focus of IE literature on firm heterogeneity suggests that IE would benefit from IB analyses of the behavior and organization of the internationalizing firm. The contributions to this volume investigate ways that insights from IB can enrich IE research in firm heterogeneity. The contributors discuss firm-specific advantages in international trade and investment, considering the firm as the unit of analysis and managerial inputs as a variable in market entry decisions; analyze interactions between a firm and its external environment, including local corporate philanthropy and institutional settings; examine the boundaries of the firm and organizational choices such as the make-or-buy decision; and investigate technology transfer and innovation offshoring, discussing the role of subsidiaries, inventor employment, and other related topics. Although IE and IB look at international firms from different perspectives, these contributions make it clear that there is a potential for a productive exchange of insights and information between the two disciplines. Contributors Laura Abramovsky, Carlo Altomonte, Sjoerd Beugelsdijk, Bruce Blonigen, Pamela Bombarda, Steven Brakman, Julia Darby, Rodolphe Desbordes, Filippo Di Mauro, María García-Vega, Harry Garretsen, Elena Huergo, Florian Mayneris, Quyen T. K. Nguyen, Verena Nowak, Cheyney O'Fallon, Gianmarco Ottaviano, Michael Pflüger, Filomena Pietrovito, Sandra Poncet, Alberto Franco Pozzolo, Alan M. Rugman, Armando Rungi, Stephan Russek, Davide Sala, Luca Salvatici, Christian Schwarz, Roger Smeets, Jens Suedekum, Hans van Ees, Vincent Vicard, Ian Wooton, Erdal Yalcin

Download or read book Firm Heterogeneity and Macroeconomic Performance written by Markus Poschke and published by . This book was released on 2007 with total page 113 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Micro Heterogeneity and Macro Implications written by Soyoung Lee (Ph. D. in economics) and published by . This book was released on 2020 with total page 197 pages. Available in PDF, EPUB and Kindle. Book excerpt: In these essays, I study quantitative macroeconomic theory with a focus on the macroeconomic implications of household and firm heterogeneity. My research is guided by analysis that begins with microeconomic data then tries to build equilibrium structural models to develop insights into the frictions and mechanisms behind these observations and their relevance for economic policy.

Download or read book Firm Heterogeneity Market Power and Macroeconomic Fragility written by Alessandro Ferrari and published by . This book was released on 2021 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book What is firm Heterogeneity in Trade Models written by Colin Hottman and published by . This book was released on 2014 with total page 52 pages. Available in PDF, EPUB and Kindle. Book excerpt: We estimate a structural model of heterogeneous multiproduct firms to examine the sources of firm heterogeneity emphasized in the recent trade and macro literatures. Using Nielsen barcode data on prices and sales, we estimate elasticities of substitution within and between firms, and use the estimated model to recover unobserved qualities, marginal costs and markups. We find that variation in firm quality and product scope explains at least four fifths of the variation in firm sales. Most firms are well approximated by the monopolistic competition benchmark of constant markups, but the largest firms that account for most of aggregate sales depart substantially from this benchmark. Although the output of multiproduct firms is differentiated, cannibalization is quantitatively important for the largest firms. This imperfect substitutability of products within firms, and the fact that larger firms supply more products than smaller firms, implies that standard productivity measures are not independent of demand system assumptions and probably dramatically understate the relative productivity of the largest firms.

Download or read book On the Importance of Firm Heterogeneity Business Dynamism and Market Power Dynamics in the Macroeconomy written by and published by . This book was released on 2024 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Open Economy Macroeconomics written by Martín Uribe and published by Princeton University Press. This book was released on 2017-04-04 with total page 646 pages. Available in PDF, EPUB and Kindle. Book excerpt: A cutting-edge graduate-level textbook on the macroeconomics of international trade Combining theoretical models and data in ways unimaginable just a few years ago, open economy macroeconomics has experienced enormous growth over the past several decades. This rigorous and self-contained textbook brings graduate students, scholars, and policymakers to the research frontier and provides the tools and context necessary for new research and policy proposals. Martín Uribe and Stephanie Schmitt-Grohé factor in the discipline's latest developments, including major theoretical advances in incorporating financial and nominal frictions into microfounded dynamic models of the open economy, the availability of macro- and microdata for emerging and developed countries, and a revolution in the tools available to simulate and estimate dynamic stochastic models. The authors begin with a canonical general equilibrium model of an open economy and then build levels of complexity through the coverage of important topics such as international business-cycle analysis, financial frictions as drivers and transmitters of business cycles and global crises, sovereign default, pecuniary externalities, involuntary unemployment, optimal macroprudential policy, and the role of nominal rigidities in shaping optimal exchange-rate policy. Based on courses taught at several universities, Open Economy Macroeconomics is an essential resource for students, researchers, and practitioners. Detailed exploration of international business-cycle analysis Coverage of financial frictions as drivers and transmitters of business cycles and global crises Extensive investigation of nominal rigidities and their role in shaping optimal exchange-rate policy Other topics include fixed exchange-rate regimes, involuntary unemployment, optimal macroprudential policy, and sovereign default and debt sustainability Chapters include exercises and replication codes

Download or read book Financial Heterogeneity Investment and Firm Interactions written by Yang Liu and published by International Monetary Fund. This book was released on 2023-05-26 with total page 41 pages. Available in PDF, EPUB and Kindle. Book excerpt: Recent literature has shown that corporate indebtedness affects firm-level investment behavior but not necessarily aggregate business cycles. I argue that interactions among heterogeneous firms play an important role in equilibrium. After a downturn, financially unconstrained firms in financially constrained industries significantly increase capital ex-penditure to substitute depressed investment by their financially constrained competitors. The increase in investment, primarily driven by small and medium firms, leads to substantial gains in future sales. Using a new empirical approach, I further show that equilibrium effects are unambiguously countercyclical because the increase in investment by unconstrained firms does not crowd out investment by financially constrained competitors. The “competitive interaction channel” underscored in this paper may play an important role in mitigating the impact of negative shocks in macroeconomic models with financial heterogeneity.

Download or read book Computational Economics Heterogeneous Agent Modeling written by Cars Hommes and published by Elsevier. This book was released on 2018-06-27 with total page 836 pages. Available in PDF, EPUB and Kindle. Book excerpt: Handbook of Computational Economics: Heterogeneous Agent Modeling, Volume Four, focuses on heterogeneous agent models, emphasizing recent advances in macroeconomics (including DSGE), finance, empirical validation and experiments, networks and related applications. Capturing the advances made since the publication of Volume Two (Tesfatsion & Judd, 2006), it provides high-level literature with sections devoted to Macroeconomics, Finance, Empirical Validation and Experiments, Networks, and other applications, including Innovation Diffusion in Heterogeneous Populations, Market Design and Electricity Markets, and a final section on Perspectives on Heterogeneity. Helps readers fully understand the dynamic properties of realistically rendered economic systems Emphasizes detailed specifications of structural conditions, institutional arrangements and behavioral dispositions Provides broad assessments that can lead researchers to recognize new synergies and opportunities

Download or read book Firm Heterogeneity Labor Markets and International Trade written by Henning Bunzel and published by Springer. This book was released on 2015-11-06 with total page 450 pages. Available in PDF, EPUB and Kindle. Book excerpt: The new macroeconomics is about distributions and flows, rather than points and intersections. Market frictions imply that the search for trading partners is time consuming and costly. Consequently, market participants flow between economic states, and trades occur at dispersed prices. This generates motives for continued search for better market opportunities, and for bargaining between potential trading partners. This volume takes the empirical analysis of markets with frictions to a new level by using unique merged registers from Denmark on firm accounting data, individual employee data, and international trade data to estimate empirically the relevant flow rates, dispersions, and relations among key variables of interest, including productivity, firm size, wages, exports, growth, and unemployment. The results serve to inform researchers and policy makers about the functioning of markets, justify the interpretation of dispersion and flows as equilibrium outcomes, and provide an understanding of cycles, adjustment, and potentials for public policy.

Download or read book Trade Flows Multilateral Resistance and Firm Heterogeneity written by Mr.Alberto Behar and published by International Monetary Fund. This book was released on 2012-12-20 with total page 39 pages. Available in PDF, EPUB and Kindle. Book excerpt: We present a gravity model that accounts for multilateral resistance, firm heterogeneity and country-selection into trade, while accommodating asymmetries in trade flows. A new equation for the proportion of exporting firms takes a gravity form, such that the extensive margin is also affected by multilateral resistance. We develop Taylor approximated multilateral resistance terms with which to capture the comparative static effects of changes in trade costs. For isolated bilateral changes in trade frictions, multilateral resistance effects are small for most countries. However, if all countries reduce their trade frictions, the impact of multilateral resistance is so strong that bilateral trade falls in most cases, despite the larger trade elasticities implied by firm heterogeneity. As a consequence, the world-wide trade response, though positive, is much lower.