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The effects of technology shocks on hours and output: a robustness analysis

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  • Fabio Canova
  • David Lopez-Salido
  • Claudio Michelacci

Abstract

We analyze the effects of neutral and investment-specific technology shocks on hours and output. Long cycles in hours are removed in a variety of ways. Hours robustly fall in response to neutral shocks and robustly increase in response to investment-specific shocks. The percentage of the variance of hours (output) explained by neutral shocks is small (large); the opposite is true for investment-specific shocks. 'News shocks' are uncorrelated with the estimated technology shocks. Copyright © 2009 John Wiley & Sons, Ltd.

Suggested Citation

  • Fabio Canova & David Lopez-Salido & Claudio Michelacci, 2010. "The effects of technology shocks on hours and output: a robustness analysis," Journal of Applied Econometrics, John Wiley & Sons, Ltd., vol. 25(5), pages 755-773.
  • Handle: RePEc:jae:japmet:v:25:y:2010:i:5:p:755-773
    DOI: 10.1002/jae.1090
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    References listed on IDEAS

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    More about this item

    JEL classification:

    • E00 - Macroeconomics and Monetary Economics - - General - - - General
    • J60 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - General
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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