Full text not available from this repository.

Abstract

Recent empirical evidence suggests that product creation is procyclical and it occurs largely within existing firms. Motivated by these findings, the current paper investigates the role of intra-firm product scope choice in a general equilibrium economy with oligopolistic producers. It shows that the multi-product nature of firms makes the economy susceptible to sunspot equilibria. The model is estimated via Bayesian methods. Artificial business cycles closely resemble empirically observed fluctuations with sunspots explaining a significant portion of U.S. business cycles.

Item Type:	Article
Authors/Creators:	Pavlov, O and Weder, M
Keywords:	indeterminacy, sunspot equilibria, multi-product firms, business cycles, bayesian estimation
Journal or Publication Title:	Review of Economic Dynamics
Publisher:	Academic Press Inc Elsevier Science
ISSN:	1094-2025
DOI / ID Number:	10.1016/j.red.2017.01.006
Copyright Information:	© 2017 Elsevier Inc
Related URLs:	UTAS Profile: Pavlov, O
Item Statistics:	View statistics for this item

Actions (login required)

Item Control Page