Download or read book The Aggregate Effects of Sectoral Shocks in an Open Economy written by Philippe Andrade and published by . This book was released on 2023 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: We study the aggregate effects of sectoral productivity shocks in a multisectoral New Keynesian open-economy model that allows for asymmetric input-output linkages, both within and between countries, as well as for heterogeneity in sectoral Calvo-type price stickiness. Asymmetries in the international production network play a key role in the model's ability to produce large domestic effects of foreign sectoral supply shocks and large differential effects of domestic shocks and global shocks. Larger trade openness and substitutability between domestic inputs and foreign inputs can also significantly amplify the effects of foreign and global sectoral shocks on domestic aggregates. In comparison, sectoral heterogeneity in price stickiness does not materially amplify the domestic responses to productivity shocks that originate abroad.
Download or read book Sectoral Shocks and Spillovers An Application to COVID 19 written by Mr. Sonali Das and published by International Monetary Fund. This book was released on 2021-07-30 with total page 26 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper examines the role of sectoral spillovers in propagating sectoral shocks in the broader economy, both in the past and during the COVID-19 pandemic. In particular, we study how shocks that occur within a sector itself and spillovers from shocks to other sectors affect sectoral activity, for a large sample of countries from 1995 to 2014. We find that both supply and demand shocks—measured as changes in, respectively, productivity and government purchases at the sector level—have large spillover effects on sector-level gross value added and on a sector’s share of the economy. We then use these historical estimates, together with the network structure of global production, to quantify the spillovers from the economic shock associated with the pandemic. We find spillover effects to be sizeable, making up a significant fraction of the overall decline in activity in 2020.Our results have implications for the design of policies with a sectoral dimension.
Download or read book Aggregate Fluctuations from Independent Sectoral Shocks written by Per Bak and published by . This book was released on 1992 with total page 56 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper illustrates how fluctuations in aggregate economic activity can result from many small, independent shocks to individual sectors. The effects of the small independent shocks fail to cancel in the aggregate due to the presence of two non-standard assumptions: local interaction between productive units (linked by supply relationships), and non-convex technology. We also argue that neither feature on its own would suffice. In the case of a simple model, we explicitly calculate the distribution of aggregate activity in the limit of an infinite number of independently disturbed sectors.
Download or read book News Shocks in Open Economies written by Mr.Rabah Arezki and published by International Monetary Fund. This book was released on 2015-09-29 with total page 54 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper explores the effect of news shocks on the current account and other macroeconomic variables using worldwide giant oil discoveries as a directly observable measure of news shocks about future output ? the delay between a discovery and production is on average 4 to 6 years. We first present a two-sector small open economy model in order to predict the responses of macroeconomic aggregates to news of an oil discovery. We then estimate the effects of giant oil discoveries on a large panel of countries. Our empirical estimates are consistent with the predictions of the model. After an oil discovery, the current account and saving rate decline for the first 5 years and then rise sharply during the ensuing years. Investment rises robustly soon after the news arrives, while GDP does not increase until after 5 years. Employment rates fall slightly for a sustained period of time.
Download or read book Monetary Policy Shocks in a Two sector Open Economy written by Ricardo Llaudes and published by . This book was released on 2007 with total page 53 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper studies the effects and the transmission mechanism of unexpected monetary policy shocks in an open economy setting within the context of a VAR framework. It considers an economy with two sectors, a tradable sector and a non-tradable sector. For a given country, economic sectors are defined according to the proportion of output that is exported to other countries. This paper departs from the standardliterature in that it tries to isolate the differential effects that monetary policy shocks may have on these two distinct sectors of the economy. The results show that the behavior of these two sectors varies whithin a country, with the tradable sector showing a higher degree of responsiveness to policy shocks than the non tradable. This result is robust across the different countries in the sample and for a synthetic aggregate. The evidence presented gives an indication that industrial structure may be an important component for the analysis of monetary policy.
Download or read book Technology Shocks and Aggregate Fluctuations written by Mr.Pau Rabanal and published by International Monetary Fund. This book was released on 2004-12-01 with total page 68 pages. Available in PDF, EPUB and Kindle. Book excerpt: Our answer: Not so well. We reached that conclusion after reviewing recent research on the role of technology as a source of economic fluctuations. The bulk of the evidence suggests a limited role for aggregate technology shocks, pointing instead to demand factors as the main force behind the strong positive comovement between output and labor input measures.
Download or read book The Aggregate Effects of Long Run Sectoral Reallocation written by Christopher Phillip Reicher and published by . This book was released on 2011 with total page 63 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Aggregate Versus Sectoral Shocks written by Saurabh Sharma and published by . This book was released on 2022 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: The comovement among different sectors of the Indian economy is found to be low which suggests an important role for sector-level disturbances vis-à-vis aggregate shocks in explaining economic fluctuations. Accordingly, the paper adopts a multisectoral framework that accounts for aggregate as well as sectoral shocks to offer a new take on the Indian economy. Using a dynamic factor model to decompose GDP, the paper finds that around 48 per cent of the variation in GDP in the long-run is explained by sectoral shocks, with their contribution increasing to 98 per cent in the short-run. Thus, short-run economic fluctuations or the business cycle is almost entirely driven by sectoral shocks. Among sectoral shocks, those associated with public administration followed by manufacturing and agriculture are found to contribute most to the GDP movement in the short run. A historical decomposition analysis shows that sectoral shocks emanating in the manufacturing sector have been consistently unfavourable, highlighting that the sector has been unable to keep pace with the rest of the economy. Further, it is found that most of the sectoral shocks move GDP and inflation in the opposite direction thereby generating an impact similar to a supply shock.
Download or read book The Cyclical Behavior of Job Creation and Job Destruction written by Jeremy Greenwood and published by London, Ont. : Department of Economics, University of Western Ontario. This book was released on 1994 with total page 42 pages. Available in PDF, EPUB and Kindle. Book excerpt:
Download or read book Sectoral Shocks and Aggregate Fluctuations written by Michael T. K. Horvath and published by . This book was released on 1998 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper presents a multisector dynamic general equilibrium model of business cycles with a distinctive feature: aggregate fluctuations are driven by independent sectoral shocks. The model hypothesizes that trade among sectors provides a strong synchronization mechanism for these shocks due to the limited, but locally intense, interaction that is characteristic of such input trade flows. Limited interaction, characterized by a sparse intermediate input-use matrix, reduces substitution possibilities among intermediate inputs which strengthens co-movement in sectoral value-added and leads to a postponement of the law of large numbers in the variance of aggregate value-added. The chief virtue of this model is that reliance on implausible aggregate shocks is not necessary to capture the qualitative features of macroeconomic fluctuations. Building on Horvath (1997), which establishes the theoretical foundation for the relevance of limited interaction in the context of a stylized multisector model, this paper specifies a more general multisector model calibrated to the U.S. 2-digit Standard Industrial Code economy. Simulations prove the model is able to match empirical reality as closely as standard one-sector business cycle models without relying on aggregate shocks.
Download or read book Learning from SARS written by Institute of Medicine and published by National Academies Press. This book was released on 2004-04-26 with total page 376 pages. Available in PDF, EPUB and Kindle. Book excerpt: The emergence of severe acute respiratory syndrome (SARS) in late 2002 and 2003 challenged the global public health community to confront a novel epidemic that spread rapidly from its origins in southern China until it had reached more than 25 other countries within a matter of months. In addition to the number of patients infected with the SARS virus, the disease had profound economic and political repercussions in many of the affected regions. Recent reports of isolated new SARS cases and a fear that the disease could reemerge and spread have put public health officials on high alert for any indications of possible new outbreaks. This report examines the response to SARS by public health systems in individual countries, the biology of the SARS coronavirus and related coronaviruses in animals, the economic and political fallout of the SARS epidemic, quarantine law and other public health measures that apply to combating infectious diseases, and the role of international organizations and scientific cooperation in halting the spread of SARS. The report provides an illuminating survey of findings from the epidemic, along with an assessment of what might be needed in order to contain any future outbreaks of SARS or other emerging infections.
Download or read book The Effects of Weather Shocks on Economic Activity What are the Channels of Impact written by Mr.Sebastian Acevedo Mejia and published by International Monetary Fund. This book was released on 2018-06-13 with total page 40 pages. Available in PDF, EPUB and Kindle. Book excerpt: Global temperatures have increased at an unprecedented pace in the past 40 years. This paper finds that increases in temperature have uneven macroeconomic effects, with adverse consequences concentrated in countries with hot climates, such as most low-income countries. In these countries, a rise in temperature lowers per capita output, in both the short and medium term, through a wide array of channels: reduced agricultural output, suppressed productivity of workers exposed to heat, slower investment, and poorer health. In an unmitigated climate change scenario, and under very conservative assumptions, model simulations suggest the projected rise in temperature would imply a loss of around 9 percent of output for a representative low-income country by 2100.
Download or read book The Macroeconomic Effects of Public Investment written by Mr.Abdul Abiad and published by International Monetary Fund. This book was released on 2015-05-04 with total page 26 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper provides new evidence of the macroeconomic effects of public investment in advanced economies. Using public investment forecast errors to identify the causal effect of government investment in a sample of 17 OECD economies since 1985 and model simulations, the paper finds that increased public investment raises output, both in the short term and in the long term, crowds in private investment, and reduces unemployment. Several factors shape the macroeconomic effects of public investment. When there is economic slack and monetary accommodation, demand effects are stronger, and the public-debt-to-GDP ratio may actually decline. Public investment is also more effective in boosting output in countries with higher public investment efficiency and when it is financed by issuing debt.
Download or read book Cyclicality and Sectoral Linkages written by Michael T. K. Horvath and published by . This book was released on 1997 with total page 0 pages. Available in PDF, EPUB and Kindle. Book excerpt: The traditional argument against the relevance of sector-specific shocks for the aggregate phenomenon of business cycles invokes the law of large numbers: positive shocks in some sectors are offset by negative shocks in other sectors. This paper hypothesizes that the law of large numbers may be postponed if the nature of sectoral interactions provides a synchronizing force, heightening co-movement in sectoral production. The analysis is performed within the context of a multi-sector model similar in spirit to that of Long and Plosser (1983). The paper explores the role limited interaction between sectors plays in determining the response of the aggregate economy from sector-specific disturbances. A feature of limited interaction that the paper stresses is that it implies few possibilities of substitution among intermediate inputs and that this increases sectoral co-movement and hence aggregate volatility. A low degree of sectoral interaction is characterized by a sparse input-use matrix. The rate at which the law of large numbers applies for increasing levels of disaggregation is shown to be controlled by the rate of increase in the number of predominantly full rows in the input-use matrix rather than by the rate of increase in the total number of sectors.Investigations of actual input-use matrices from the U.S. economy reveal that the number of full rows increases much slower than the total number of rows upon disaggregation, and when these input-use matrices are used to parameterize the model, aggregate volatility from sectoral shocks declines at a slower rate than that implied by the law of large numbers.
Download or read book Labor Statistics Measurement Issues written by John Haltiwanger and published by University of Chicago Press. This book was released on 2007-12-01 with total page 494 pages. Available in PDF, EPUB and Kindle. Book excerpt: Rapidly changing technology, the globalization of markets, and the declining role of unions are just some of the factors that have led to dramatic changes in working conditions in the United States. Little attention has been paid to the difficult measurement problems underlying analysis of the labor market. Labor Statistics Measurement Issues helps to fill this gap by exploring key theoretical and practical issues in the measurement of employment, wages, and workplace practices. Some of the chapters in this volume explore the conceptual issues of what is needed, what is known, or what can be learned from existing data, and what needs have not been met by available data sources. Others make innovative uses of existing data to analyze these topics. Also included are papers examining how answers to important questions are affected by alternative measures used and how these can be reconciled. This important and useful book will find a large audience among labor economists and consumers of labor statistics.
Download or read book Business Cycles Indicators and Forecasting written by James H. Stock and published by University of Chicago Press. This book was released on 2008-04-15 with total page 350 pages. Available in PDF, EPUB and Kindle. Book excerpt: The inability of forecasters to predict accurately the 1990-1991 recession emphasizes the need for better ways for charting the course of the economy. In this volume, leading economists examine forecasting techniques developed over the past ten years, compare their performance to traditional econometric models, and discuss new methods for forecasting and time series analysis.
Download or read book Booming Sector and Dutch Disease Economics written by Warner Max Corden and published by . This book was released on 1982 with total page 37 pages. Available in PDF, EPUB and Kindle. Book excerpt:
