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Real business cycles: a legacy of countercyclical policies?

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  • Satyajit Chatterjee

Abstract

If business cycles are caused mostly by changes in productivity, rather than by monetary and financial disturbances, what role do monetary and fiscal policies play? In this article, Satyajit Chatterjee discusses the possibility that countercyclical monetary and fiscal policies have played an important role in reducing the severity of business cycles since World War II but that additional countercyclical policies that try to offset movements in productivity aren't likely to be beneficial

Suggested Citation

  • Satyajit Chatterjee, 1999. "Real business cycles: a legacy of countercyclical policies?," Business Review, Federal Reserve Bank of Philadelphia, issue Jan, pages 17-27.
    • Handle: RePEc:fip:fedpbr:y:1999:i:jan:p:17-27
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    File URL: https://www.philadelphiafed.org/-/media/frbp/assets/economy/articles/business-review/1999/january-february/brjf99sc.pdf
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    References listed on IDEAS

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    6. Long, John B, Jr & Plosser, Charles I, 1983. "Real Business Cycles," Journal of Political Economy, University of Chicago Press, vol. 91(1), pages 39-69, February.
    7. Kydland, Finn E & Prescott, Edward C, 1991. "Hours and Employment Variation in Business Cycle Theory," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 1(1), pages 63-81, January.
    8. Zarnowitz, Victor, 1992. "Business Cycles," National Bureau of Economic Research Books, University of Chicago Press, number 9780226978901, December.
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    Cited by:

    1. David B. Gordon & Eric M. Leeper, 2005. "Are Countercyclical Fiscal Policies Counterproductive?," NBER Working Papers 11869, National Bureau of Economic Research, Inc.
    2. Nicholas Aspergis & Stephen M. Miller, 2003. "Macroeconomic Rationality and Lucas' Misperceptions Model: Further Evidence from Forty-One Countries," Working papers 2003-26, University of Connecticut, Department of Economics.
    3. Satyajit Chatterjee, 2000. "From cycles to shocks: progress in business-cycle theory," Business Review, Federal Reserve Bank of Philadelphia, issue Mar, pages 27-37.
    4. Stephen A. Pyhrr & Stephen E. Roulac & Waldo L. Born, 1999. "Real Estate Cycles and Their Strategic Implications for Investors and Portfolio Managers in the Global Economy," Journal of Real Estate Research, American Real Estate Society, vol. 18(1), pages 7-68.
    5. Apergis, Nicholas & Miller, Stephen, 2004. "Macroeconomic rationality and Lucas' misperceptions model: further evidence from 41 countries," Journal of Economics and Business, Elsevier, vol. 56(3), pages 227-241.
    6. Nicholas Apergis & Stephen M. Miller, 2007. "Total Factor Productivity and Monetary Policy: Evidence from Conditional Volatility," International Finance, Wiley Blackwell, vol. 10(2), pages 131-152, July.
    7. César Calderón & Roberto Duncan & Klaus Schmidt-Hebbel, 2016. "Do Good Institutions Promote Countercyclical Macroeconomic Policies?," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 78(5), pages 650-670, October.
    8. Abir Riad Takieddine, 2019. "Labor Market and Education in Lebanon: The Missing Link," International Journal of Economics and Finance, Canadian Center of Science and Education, vol. 11(10), pages 42-53, October.

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