Author: Ricardo J. Caballero
Publisher:
ISBN:
Category :
Languages : en
Pages : 35

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Author: Ricardo J. Caballero
Publisher:
ISBN:
Category : Capital investments
Languages : en
Pages : 56

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Book Description
In this paper we derive a model of aggregate investment that builds from the lumpy microeconomic behavior of firms facing stochastic fixed adjustment costs. Instead of the standard (S, s) bands, firms' optimal adjustment policies are probabilistic, with a probability of adjusting (adjustment hazard) that grows smoothly with firms' disequilibria. Depending upon the specification of the distribution of fixed adjustment costs, the adjustment hazards approach encompasses models ranging from the very non-linear (S, s) model to the linear partial adjustment model. Except for the latter extreme, the processes for aggregate investment obtained from adding up the actions of firms subject to aggregate and idiosyncratic shocks, is highly non-linear. Estimating the aggregate model by maximum likelihood, we find clear evidence supporting non-linear models over linear ones for postwar sectoral U.S. manufacturing equipment and structures investment. For a given sequence of aggregate shocks, the nonlinear model estimated generates brisker expansions and - to a lesser extent - sharper contractions than its linear counterpart. These features fit well the observed positive skewness and large kurtosis of U.S. manufacturing sectoral investment/capital ratios.

Author: Ricardo J. Caballero
Publisher:
ISBN:
Category : Capital investments
Languages : en
Pages : 82

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The 90s have witnessed a revival in economists' interest and hope of explaining" aggregate and microeconomic investment behavior. New theories, better econometric" procedures, and more detailed panel data sets are behind this movement. Much of the progress" has occurred at the level of microeconomic theories and evidence; however aggregation and general equilibrium aspects of the investment problem also has been significant." The concept of sunk costs is at the center of modern theories. The implications of these costs for" investment go well beyond the neoclassical response to the irreversible-technological friction" they represent, for they can also lead to first order inefficiencies when interacting with" informational and contractual problems

Author: Christopher Russell
Publisher:
ISBN:
Category : Manufacturing industries
Languages : en
Pages : 0

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Book Description
Evidence of a resurgent, domestic manufacturing sector has strategic implications for energy policy as well as the economy. This industrial renewal is an opportunity to lock in energy savings for a generation for the U.S., and should be taken advantage of by state and utility energy programs. This report examines the dynamics of capital investment that drives industrial energy use and competitiveness. The report presents results from a survey of industry stakeholders that identifies the nature of capital investment decision-making. With a better understanding of capital investment dynamics, program administrators can work in concert with industry managers to build more efficient and productive manufacturing facilities on U.S. soil to create a more efficient and competitive manufacturing base for the future.

Author: Arne Bigsten
Publisher: International Monetary Fund
ISBN:
Category : Business & Economics
Languages : en
Pages : 58

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Book Description
This paper seeks to determine whether firm level investment behavior in the manufacturing sectors of Cameroon, Ghana, Kenya, Zambia and Zimbabwe is more accurately described by standard theory based on quadratic adjustment costs or by alternative models, based on irreversibilities or fixed costs. The importance of this issue stems first from a theoretical perspective, given that the adjustment cost function constitutes one of the cornerstones of the investment equation, and misspecification of adjustment costs is likely to yield a misspecified investment model. Second, empirically, information on the structure and size of adjustment costs is important for understanding how investment responds to changes in fundamentals. For example, some non-quadratic adjustment cost models imply that firm investment is nonlinear: periods of little response to shocks can be followed by intensive responses to both current and accumulated shocks. The structure of adjustment costs also has significant implications for understanding aggregate investment dynamics. 2.

Author: Bradley T. Ewing
Publisher: Routledge
ISBN: 113599059X
Category : Business & Economics
Languages : en
Pages : 241

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Book Description
This book fills the gap between intermediate and advanced graduate level books Contains more pedagogy than is customary for an advanced undergraduate text Explores contemporary theory in macroeconomics including new and endogenous growth theory, real business cycles, New Classical and New Keynesian Macroeconomics as well as the role of exchange rates

Author: Christopher F. Parmeter
Publisher: Springer Nature
ISBN: 3030471063
Category : Business & Economics
Languages : en
Pages : 371

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Book Description
The volume examines the state-of-the-art of productivity and efficiency analysis. It brings together a selection of the best papers from the 10th North American Productivity Workshop. By analyzing world-wide perspectives on challenges that local economies and institutions may face when changes in productivity are observed, readers can quickly assess the impact of productivity measurement, productivity growth, dynamics of productivity change, measures of labor productivity, measures of technical efficiency in different sectors, frontier analysis, measures of performance, industry instability and spillover effects. The contributions in this volume focus on the theory and application of economics, econometrics, statistics, management science and operational research related to problems in the areas of productivity and efficiency measurement. Popular techniques and methodologies including stochastic frontier analysis and data envelopment analysis are represented. Chapters also cover broader issues related to measuring, understanding, incentivizing and improving the productivity and performance of firms, public services, and industries.

Author: Jonas Daniel Maurice Fisher
Publisher:
ISBN:
Category : Business cycles
Languages : en
Pages : 44

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Author: Cristiano Antonelli
Publisher: Edward Elgar Publishing
ISBN: 1845427920
Category : Technology & Engineering
Languages : en
Pages : 495

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Book Description
This Festschrift explores the truly exceptional breadth and depth of Paul David s work, focusing upon his contributions to the topics of path dependence, the economics of knowledge, and the diffusion of technology. The book consists of 15 papers plus an introduction by the editors and an entertaining postscript by Dominique Foray. . . For economic historians, the papers on path dependence assembled in this book, and particularly the conceptual paper by Antonelli, should be essential reading. Nikolaus Wolf, Economic History Review Recent research on the economics of innovation has acknowledged the importance of path dependence and networks in the evolution of economies and the diffusion of new techniques, products, and processes. These are topics pioneered by Paul A. David, one of the world s leading scholars in the economics of innovation. This outstanding collection provides a fitting tribute to the diversity and depth of Paul David s contributions. The papers included range from simulation models of the evolution of market structure in the presence of innovation, through historical investigations of knowledge networks and empirical analysis of contemporary networks, to the analysis of the diffusion of innovations using simulation and analytic models and of the diffusion of knowledge using patent data. With an emphasis on simulation models, data analysis, and historical evidence, this book will be required reading for researchers in innovation economics and regional development as well as economists, sociologists, and historians of innovation and intellectual property.

Author: Nancy L. Stokey
Publisher: Princeton University Press
ISBN: 0691135053
Category : Business & Economics
Languages : en
Pages : 321

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Book Description
In The Economics of Inaction, leading economist Nancy Stokey shows how the tools of stochastic control can be applied to dynamic problems of decision making under uncertainty when fixed costs are present. Stokey provides a self-contained, rigorous, and clear treatment of two types of models, impulse and instantaneous control. She presents the relevant results about Brownian motion and other diffusion processes, develops methods for analyzing each type of problem, and discusses applications to price setting, investment, and durable goods purchases."--Pub. desc.