Time to build and aggregate fluctuations: some new evidence
This paper presents maximum likelihood estimates of a real business cycle model very similar to one Kydland and Prescott  suggested. The results of the paper conflict with Kydland and Prescott’s. The model leaves unexplained much of the variance of two key investment series, namely, structures and equipment. Also, much of the variation in the differences of per capita hours can be generated assuming that past leisure choices do not affect current utility.
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- Lucas, Robert E, Jr, 1970. "Capacity, Overtime, and Empirical Production Functions," American Economic Review, American Economic Association, vol. 60(2), pages 23-27, May.
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"Time to Build and Aggregate Fluctuations,"
Econometric Society, vol. 50(6), pages 1345-1370, November.
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55, Federal Reserve Bank of Minneapolis.
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- Thomas Mayer, 1959. "Plant and Equiptment Lead Times," The Journal of Business, University of Chicago Press, vol. 33, pages 127-127.
- Nelson, Charles R. & Plosser, Charles I., 1982. "Trends and random walks in macroeconmic time series : Some evidence and implications," Journal of Monetary Economics, Elsevier, vol. 10(2), pages 139-162.
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