search query: @indexterm BUSINESS CYCLES / total: 529
reference: 249 / 529
| Author: | Ewijk, C. van |
| Title: | Entry and exit, cycles, and productivity growth |
| Journal: | Oxford Economic Papers
1997 : APR, VOL. 49:2, p. 167-187 |
| Index terms: | BUSINESS CYCLES PRODUCTIVITY GROWTH ENTRY CONDITIONS EXIT CONDITIONS |
| Language: | eng |
| Abstract: | This paper argues that the positive view of recessions may be too optimistic if one takes account of entry and exit behavior of firms. When recessions are associated with exit of firms they cause losses of knowledge and have a negative effect on productivity. Unemployed workers lose skills and technology incorporated in firms wears out when not utilized. This paper takes into account this rusting effect in a cyclical model with entry and exit. The results indicate that whether short-term variability is good or bad for long-term growth depends on the magnitude of the fluctuations. |
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