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The contribution of firm-level shocks to aggregate fluctuations: The case of Sweden

Author

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  • Friberg, Richard
  • Sanctuary, Mark

Abstract

We use annual observations on sales at the firm-destination level of all Swedish firms for 1997–2008 to examine the contribution of firm-level shocks to aggregate fluctuations. The firm-specific and sector-destination components each contribute about equally to aggregate sales volatility. For export volatility, the firm-specific component is more important. The analysis is conducted so as to ease a comparison to earlier results using French data. Compared to the French case the Swedish data show greater granularity and greater overall volatility, but also a lower firm-level contribution to aggregate volatility.

Suggested Citation

  • Friberg, Richard & Sanctuary, Mark, 2016. "The contribution of firm-level shocks to aggregate fluctuations: The case of Sweden," Economics Letters, Elsevier, vol. 147(C), pages 8-11.
  • Handle: RePEc:eee:ecolet:v:147:y:2016:i:c:p:8-11
    DOI: 10.1016/j.econlet.2016.08.009
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    References listed on IDEAS

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    1. Andrew T. Foerster & Pierre-Daniel G. Sarte & Mark W. Watson, 2011. "Sectoral versus Aggregate Shocks: A Structural Factor Analysis of Industrial Production," Journal of Political Economy, University of Chicago Press, vol. 119(1), pages 1-38.
    2. Daron Acemoglu & Vasco M. Carvalho & Asuman Ozdaglar & Alireza Tahbaz‐Salehi, 2012. "The Network Origins of Aggregate Fluctuations," Econometrica, Econometric Society, vol. 80(5), pages 1977-2016, September.
    3. Julian di Giovanni & Andrei A. Levchenko & Isabelle Mejean, 2014. "Firms, Destinations, and Aggregate Fluctuations," Econometrica, Econometric Society, vol. 82(4), pages 1303-1340, July.
    4. Stella, Andrea, 2015. "Firm dynamics and the origins of aggregate fluctuations," Journal of Economic Dynamics and Control, Elsevier, vol. 55(C), pages 71-88.
    5. Xavier Gabaix, 2011. "The Granular Origins of Aggregate Fluctuations," Econometrica, Econometric Society, vol. 79(3), pages 733-772, May.
    6. Julian di Giovanni & Andrei A. Levchenko, 2012. "Country Size, International Trade, and Aggregate Fluctuations in Granular Economies," Journal of Political Economy, University of Chicago Press, vol. 120(6), pages 1083-1132.
    7. Ekholm, Karolina & Moxnes, Andreas & Ulltveit-Moe, Karen Helene, 2012. "Manufacturing restructuring and the role of real exchange rate shocks," Journal of International Economics, Elsevier, vol. 86(1), pages 101-117.
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    Cited by:

    1. Julian di Giovanni & Andrei A. Levchenko & Isabelle Mejean, 2018. "The Micro Origins of International Business-Cycle Comovement," American Economic Review, American Economic Association, vol. 108(1), pages 82-108, January.
    2. Sandro Claudio Lera & Didier Sornette, 2017. "GDP growth rates as confined L\'evy flights," Papers 1709.05594, arXiv.org.
    3. repec:mnb:finrev:v:16:y:2017:i:2:p:40-63 is not listed on IDEAS

    More about this item

    Keywords

    Firm heterogeneity; Aggregate fluctuations; Granularity;

    JEL classification:

    • D20 - Microeconomics - - Production and Organizations - - - General
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics

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