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Business Cycle Accounting for the COVID-19 Recession

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  • Fernandes, Daniel

Abstract

We apply the Business Cycle Accounting framework to the COVID-19 recession in the Euro Area and the United States. We conclude that the efficiency wedge had the most important role in the Euro Area, followed by the labor and investment wedges. In the United States, the labor wedge was most crucial, with the investment wedge taking a second place. We present hypotheses, supported by our theoretical framework, for the dichotomy of the role of the efficiency wedge between the studied regions.

Suggested Citation

  • Fernandes, Daniel, 2022. "Business Cycle Accounting for the COVID-19 Recession," MPRA Paper 111577, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:111577
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    More about this item

    Keywords

    Economics COVID-19 Business Cycle Accounting Macroeconomics Financial Crises Financial Frictions Wedges;

    JEL classification:

    • E3 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • F4 - International Economics - - Macroeconomic Aspects of International Trade and Finance
    • F44 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - International Business Cycles

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