Macroeconomic resilience in a DSGE model

摘要: We use the dynamic stochastic general equilibrium (DSGE) model of Altig et al. (2005) to analyse resilience an economy in face external shocks. The term refers ability prosper was chosen because it combined both demand and supply shocks various market rigidities/imperfections, which have potential affect resilience, are modelled. consider level expected discounted utility be relevant measure resilience. effect rigidities, eg. wage price stickiness, on is minimal. especially small when compared competition, latter has a direct output. This conclusion holds for family constant-relative-risk-aversion-over-consumption functions. A similar drawn by Lucas (1987) regarding costs business cycles. refer literature that followed ideas how DSGE might adjusted give more meaningful analysis conclude does not produce relationship between rigidities output and, hence, capture inflexibility one observes colloquially.