TY - JOUR
T1 - The workweek of capital and its cyclical implications
AU - Kydland, Finn E.
AU - Prescott, Edward C.
N1 - Copyright:
Copyright 2014 Elsevier B.V., All rights reserved.
PY - 1988
Y1 - 1988
N2 - The neoclassical growth model studied in the Kydland and Prescott 'Time to Build' paper is modified to permit the capital utilization rate to vary. The effect of this modification is to increase the amplitude of the aggregate fluctuations predicted by theory as the equilibrium response to technological shocks. If, following Solow, the changes in output not accounted for by changes in the labor and tangible capital inputs are interpreted as being the technology shocks, the statistical properties of the fluctuations in the postwar United States economy are close in magnitude and nature to those predicted by theory.
AB - The neoclassical growth model studied in the Kydland and Prescott 'Time to Build' paper is modified to permit the capital utilization rate to vary. The effect of this modification is to increase the amplitude of the aggregate fluctuations predicted by theory as the equilibrium response to technological shocks. If, following Solow, the changes in output not accounted for by changes in the labor and tangible capital inputs are interpreted as being the technology shocks, the statistical properties of the fluctuations in the postwar United States economy are close in magnitude and nature to those predicted by theory.
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U2 - 10.1016/0304-3932(88)90035-9
DO - 10.1016/0304-3932(88)90035-9
M3 - Article
AN - SCOPUS:0008423770
SN - 0304-3932
VL - 21
SP - 343
EP - 360
JO - Journal of Monetary Economics
JF - Journal of Monetary Economics
IS - 2-3
ER -