News from Feb 07, 2017
On Tuesday, February 14, 4:00-6:00 pm, Franck Portier from the University of Toulouse will be the speaker of the Schumpeter Seminar. He will present his research paper on "Putting the Cycle Back into Business Cycle Analysis" at Humboldt University of Berlin (HU), room 23, Spandauer Str. 1, 10178 Berlin
This paper begins by re-examining the spectral properties of several cyclically sensitive variables such as hours worked, unemployment and capacity utilization. For each of these series, we document the presence of an important peak in the spectral densityat a periodicity of approximately 36-40 quarters. We take this pattern as suggestive of intriguing but little-studied cyclical phenomena at the long end of the business cycle, and we ask how best to explain it. In particular, we explore whether such patterns may reflect slow-moving limit cycle forces, wherein booms sow the seeds of the subsequent busts. To this end, we present a general class of models, featuring local complementarities, that can give rise to unique-equilibrium behavior characterized by stochastic limit cycles. We then use the framework to extend a New Keynesian-type model in a manner aimed at capturing the notion of an accumulation-liquidation cycle. We estimate the model by indirect inference and find that the cyclical properties identifed in the data can be well explained by stochastic limit cycles forces, where the exogenous disturbances to the system are very short lived. This contrasts with results from most other macroeconomic models, which typically require very persistent shocks in orderto explain macroeconomic fuctuations.
For more information on the program of the Schumpeter Seminar please klick follow this link.