search query: @author Wright, R. / total: 19
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| Author: | McGrattan, E. R. Rogerson, R. Wright, R. |
| Title: | An equilibrium model of the business cycle with household production and fiscal policy |
| Journal: | International Economic Review
1997 : MAY, VOL. 38:2, p. 267-290 |
| Index terms: | BUSINESS CYCLES HOUSEHOLD ECONOMICS FISCAL POLICY |
| Language: | eng |
| Abstract: | This study evaluates the importance of home production in models of aggregate economic activity by obtaining maximum likelihood estimates of a stochastic growth model with an explicit household sector. The elasticy of substitution between output of the two sectors is the most important parameter for the hypothesis that household production affects market activity. There is a significant elasticity of substitution between home and market goods. Restrictions on the model cannot be rejected, that imply that market activity is not affected by changes in relative productivity across two sectors. The study also examines how well the estimated model accounts for the standard set of moments on which real business cycle theorists focus, and the model is used to study the effects of fiscal policy changes. |
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