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Business Cycle Accounting for Argentina Utilizing Capital Utilization

Author

Listed:
  • Tiago Cavalcanti

    (University of Cambridge)

  • Pedro Elosegui

    (Central Bank of Argentina)

  • George McCandless

    () (Central Bank of Argentina)

  • Emilio Blanco

    () (Central Bank of Argentina)

Abstract

We use a variation on the business cycle accounting method of Chari, Kehoe and McGrattan to study the business cycle in Argentina from 1972 to 2006. We use capital utilization as a household decision variable to be able to better extract the wedge that functions as a tax on capital. Applying the model to Argentina, we find that all four wedges are important in explaining the evolution of output over this period (although net exports is the least important). The major political subperiods can be charaterized by the relative importance of each wedge. We compare the results of this technique to the standard narrative.

Suggested Citation

  • Tiago Cavalcanti & Pedro Elosegui & George McCandless & Emilio Blanco, 2008. "Business Cycle Accounting for Argentina Utilizing Capital Utilization," BCRA Working Paper Series 200830, Central Bank of Argentina, Economic Research Department.
  • Handle: RePEc:bcr:wpaper:200830
    as

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    File URL: http://www.bcra.gov.ar/pdfs/investigaciones/WP%202008%2030_i.pdf
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    References listed on IDEAS

    as
    1. Neumeyer, Pablo A. & Perri, Fabrizio, 2005. "Business cycles in emerging economies: the role of interest rates," Journal of Monetary Economics, Elsevier, vol. 52(2), pages 345-380, March.
    2. Harold L. Cole & Lee E. Ohanian, 2002. "The U.S. and U.K. Great Depressions Through the Lens of Neoclassical Growth Theory," American Economic Review, American Economic Association, vol. 92(2), pages 28-32, May.
    3. Werner Baer & Pedro Elosegui & Andres Gallo, 2002. "The Achievements and Failures of Argentina's Neo-liberal Economic Policies," Oxford Development Studies, Taylor & Francis Journals, vol. 30(1), pages 63-85.
    4. V. V. Chari & Patrick J. Kehoe & Ellen R. McGrattan, 2007. "Business Cycle Accounting," Econometrica, Econometric Society, vol. 75(3), pages 781-836, May.
    5. Andrea Catenazzi & Pablo Forni & Célia Himelfarb & Maria Eugenia Longo & Nicole Maurice & Marcos Medina & Luis Miotti & Gabriel Nardacchione & Carlos Quenan & Isabel Rauber & Natalia Da Representação, 2005. "Argentina," Post-Print halshs-00391943, HAL.
    6. Edgardo E. Zablotsky, 1992. "A Public Choice Approach to Military Coups d'Etat," CEMA Working Papers: Serie Documentos de Trabajo. 85, Universidad del CEMA.
    7. Tiago Cavalcanti, 2007. "Business cycle and level accounting: the case of Portugal," Portuguese Economic Journal, Springer;Instituto Superior de Economia e Gestao, vol. 6(1), pages 47-64, April.
    8. Edward C. Prescott, 2002. "Prosperity and Depression," American Economic Review, American Economic Association, vol. 92(2), pages 1-15, May.
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    Cited by:

    1. Chakraborty Suparna & Otsu Keisuke, 2013. "Business cycle accounting of the BRIC economies," The B.E. Journal of Macroeconomics, De Gruyter, vol. 13(1), pages 1-33, September.

    More about this item

    Keywords

    Argentina; capital utilization; business cycle; distortion measures; growth accounting;

    JEL classification:

    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • N16 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - Latin America; Caribbean

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