Publication
Oct 2009
This working paper finds that the introduction of capital in an endogenous separations New Keynesian matching model generates an important channel for the transmission of aggregate productivity shocks, using capital-labor trade-off. The authors use a more general approach than vintage capital theory, such that workers have unrestricted access to a proportional share of the capital stock. Their model generates higher volatilities of key variables and therefore enhances the performance of the matching model.
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English (PDF, 25 pages, 500 KB) |
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Author | Björn van Roye, Dennis Wesselbaum |
Series | Kiel Institute Working Papers |
Issue | 1561 |
Publisher | Kiel Institute for the World Economy |
Copyright | © 2009 Kiel Institute for the World Economy |