Cookies?
Library Header Image
LSE Theses Online London School of Economics web site

Essays in business cycle measurement.

Caporale, Guglielmo Maria (1990) Essays in business cycle measurement. PhD thesis, London School of Economics and Political Science (United Kingdom).

[img]
Preview
PDF
Download (4MB) | Preview

Abstract

This dissertation is concerned with the issue of economic fluctuations; the following related topics are analysed: co-integration and the NAIRU hypothesis: the theoretical implications of different classes of models, some implying that the NAIRU is a structural parameter that can only be influenced by supply-side measures, others that the attainable level of unemployment is a function also of demand variables, are first discussed; co-integration techniques (the Engle-Granger and the Johansen procedure) are then used to test the NAIRU hypothesis; the more powerful maximum likelihood method developed by Johansen shows that the unemployment rate is co-integrated with both supply and demand variables only as well as a combination of the two; supply versus demand shocks as the driving force of business cycles: using two measures of productivity growth (the Solow residual and the dual residual from the cost function), competing theories of the cycle are tested in a number of OECD countries; the issue of market structure and its relevance to explain economic fluctuations is also addressed; the empirical evidence refutes the "stronger" real business cycle (RBC) hypothesis that denies the role of demand shocks; aggregate versus sectoral shocks: their relative importance in the UK economy is evaluated by estimating a vector autoregression (VAR) of the output growth rates of 19 industrial sectors and doing a factor analysis on the innovations; the one-factor model performs quite well when applied to the British data implying that there is an aggregate shock that can account for a high percentage of the fluctuations of output over the cycle; the "seasonal cycle" in the UK economy: the quantitative importance of seasonal fluctuations and the existence of a "seasonal cycle" whose main features are very similar to those of the conventional business cycle are documented by running regressions with seasonal dummies and band spectrum regressions; a one-sector, neo-classical model of capital accumulation in which seasonal preferences are explicitly incorporated (the coefficient of risk aversion depending on the season s) is then set up; the model is not rejected by the data, confirming that seasonality is a feature to be explained within the economic model.

Item Type: Thesis (PhD)
Uncontrolled Keywords: Economics, General
Sets: Collections > ProQuest Etheses
URI: http://etheses.lse.ac.uk/id/eprint/1182

Actions (login required)

Record administration - authorised staff only Record administration - authorised staff only

Downloads

Downloads per month over past year

View more statistics