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Business Fixed Investment and the Recent Business Cycle in Japan

In: NBER Macroeconomics Annual 1996, Volume 11

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  • Nobuhiro Kiyotaki
  • Kenneth D. West

Abstract

To analyze business fixed investment in Japan, which has been unusually volatile in recent years, we develop and apply a loglinear flexible accelerator model. We find that movements in business fixed investment are consistent with movements in output and the tax- adjusted cost of capital, both on average during our entire 1961-94 sample and during the recent 1986-94 business cycle.
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Suggested Citation

  • Nobuhiro Kiyotaki & Kenneth D. West, 1996. "Business Fixed Investment and the Recent Business Cycle in Japan," NBER Chapters,in: NBER Macroeconomics Annual 1996, Volume 11, pages 277-344 National Bureau of Economic Research, Inc.
  • Handle: RePEc:nbr:nberch:11031
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    References listed on IDEAS

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    Cited by:

    1. Bernd Süssmuth, 2002. "National and Supranational Business Cycles (1960-2000): A multivariate description of central G7 and EURO15 NIPA aggregates," CESifo Working Paper Series 658, CESifo Group Munich.
    2. John M. Roberts, 2003. "Modeling aggregate investment: a fundamentalist approach," Finance and Economics Discussion Series 2003-48, Board of Governors of the Federal Reserve System (U.S.).
    3. repec:hal:journl:halshs-00085680 is not listed on IDEAS
    4. Khan, Aubhik & Thomas, Julia K., 2003. "Nonconvex factor adjustments in equilibrium business cycle models: do nonlinearities matter?," Journal of Monetary Economics, Elsevier, vol. 50(2), pages 331-360, March.
    5. Nakajima, Tomoyuki, 2008. "Asset price fluctuations in Japan: 1980-2000," Japan and the World Economy, Elsevier, vol. 20(1), pages 129-153, January.
    6. Nan-Kuang Chen & Hung-Jen Wang, 2007. "The Procyclical Leverage Effect Of Collateral Value On Bank Loans-Evidence From The Transaction Data Of Taiwan," Economic Inquiry, Western Economic Association International, vol. 45(2), pages 395-406, April.
    7. Danny Leung & Terence Yuen, 2010. "Do exchange rates affect the capital-labour ratio? Panel evidence from Canadian manufacturing industries," Applied Economics, Taylor & Francis Journals, vol. 42(20), pages 2519-2535.
    8. Caballero, Ricardo J., 1999. "Aggregate investment," Handbook of Macroeconomics,in: J. B. Taylor & M. Woodford (ed.), Handbook of Macroeconomics, edition 1, volume 1, chapter 12, pages 813-862 Elsevier.
    9. Robert Chirinko & Steven M. Fazzari & Andrew P. Meyer, 2002. "That Elusive Elasticity: A Long-panel Approach to Estimating the Price Sensitivity of Business Capital," Emory Economics 0202, Department of Economics, Emory University (Atlanta).
    10. Schaller, Huntley, 2006. "Econometric Issues in Estimating User Cost Elasticity," Economics Series 194, Institute for Advanced Studies.
    11. Julia K. Thomas, 2002. "Is Lumpy Investment Relevant for the Business Cycle?," Journal of Political Economy, University of Chicago Press, vol. 110(3), pages 508-534, June.
    12. Tevlin, Stacey & Whelan, Karl, 2003. " Explaining the Investment Boom of the 1990s," Journal of Money, Credit and Banking, Blackwell Publishing, vol. 35(1), pages 1-22, February.
    13. Chirinko, Robert S., 2002. "Corporate Taxation, Capital Formation,and the Substitution Elasticity Between Labor and Capital," National Tax Journal, National Tax Association, vol. 55(2), pages 339-355, June.
    14. Schaller, Huntley, 2006. "Estimating the long-run user cost elasticity," Journal of Monetary Economics, Elsevier, vol. 53(4), pages 725-736, May.
    15. Motonishi, Taizo & Yoshikawa, Hiroshi, 1999. "Causes of the Long Stagnation of Japan during the 1990s: Financial or Real?," Journal of the Japanese and International Economies, Elsevier, vol. 13(3), pages 181-200, September.
    16. Robert S. Chirinko & Huntley Schaller, 2001. "Business Fixed Investment and "Bubbles": The Japanese Case," American Economic Review, American Economic Association, vol. 91(3), pages 663-680, June.
    17. Nakajima, Tomoyuki, 2008. "Asset price fluctuations in Japan: 1980-2000," Japan and the World Economy, Elsevier, vol. 20(1), pages 129-153, January.
    18. Laurent Soulat, 2006. "Les modèles Q-investissement et les modèles d'Euler," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-00085680, HAL.
    19. repec:eee:jmacro:v:53:y:2017:i:c:p:235-250 is not listed on IDEAS
    20. Nobuhiro Kiyotaki & Kenneth D. West, 2006. "Land Prices and Business Fixed Investment in Japan," Chapters,in: Long-run Growth and Short-run Stabilization, chapter 12 Edward Elgar Publishing.
    21. Roong Poshyananda Mallikamas & Yunyong Thaicharoen & Daungporn Rodpengsangkaha, 2003. "Investment Cycles, Economic Recovery and Monetary Policy," Working Papers 2003-04, Monetary Policy Group, Bank of Thailand.
    22. Robert S. Chirinko & Steven M. Fazzari & Andrew P. Meyer, 2004. "That Elusive Elasticity: A Long-Panel Approach to Estimating the Capital-Labor Substitution Elasticity," CESifo Working Paper Series 1240, CESifo Group Munich.
    23. Laurent Soulat, 2006. "Les modèles Q-investment et les modèles d'Euler : relations de banque principale, asymétries informationnelles et modifications des structures financières des firmes de keiretsu financier," Cahiers de la Maison des Sciences Economiques bla06010, Université Panthéon-Sorbonne (Paris 1).

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