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Learning by Doing as a Propagation Mechanism

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  • Chang, Yongsung
  • Gomes, Joao F
  • Schorfheide, Frank

Abstract

This Paper suggests that skill accumulation through past work experience, or ‘learning-by-doing’ (LBD), can provide an important propagation mechanism in a dynamic stochastic general equilibrium model, as the current labour supply affects future productivity. Our econometric analysis uses a Bayesian approach to combine micro-level panel data with aggregate time series. Formal model evaluation shows that the introduction of the LBD mechanism improves the model's ability to fit the dynamics of aggregate output and hours.

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Bibliographic Info

Paper provided by C.E.P.R. Discussion Papers in its series CEPR Discussion Papers with number 3599.

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Date of creation: Oct 2002
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Handle: RePEc:cpr:ceprdp:3599

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Keywords: business cycles; labour supply; learning by doing; propagation;

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