Overtime, effort, and the propagation of business cycle shocks
AbstractThis paper presents and estimates a variant of Hansen and Sargent's (1988) real business cycle model with straight time and overtime. The model presented has only one latent variable, the state of technology, yet it does a better job propagating and magnifying shocks than the labor hoarding models which incorporate unobserved effort. This model, as well as a version of Burnside, Eichenbaum and Rebelo's (1993) labor hoarding model, is estimated using maximum likelihood. The maximum likelihood parameter estimates are compared to those using GMM.
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Bibliographic InfoArticle provided by Elsevier in its journal Journal of Monetary Economics.
Volume (Year): 38 (1996)
Issue (Month): 1 (August)
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Web page: http://www.elsevier.com/locate/inca/505566
Other versions of this item:
- George J. Hall, 1994. "Overtime, effort and the propagation of business cycle shocks," Working Paper Series, Macroeconomic Issues 94-25, Federal Reserve Bank of Chicago.
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