Title: How much Keynes and how much Schumpeter? An Estimated Macromodel for the US Economy JRC Working Papers in Economics and Finance, 2017/1
Authors: COZZI GUIDOPATARACCHIA BEATRICEPFEIFFER PHILIPPRATTO MARCO
Publisher: Publications Office of the European Union
Publication Year: 2017
JRC N°: JRC104106
ISBN: 978-92-79-67436-5
ISSN: 2467-2203
Other Identifiers: OP KJ-AE-17-001-EN-N
URI: http://publications.jrc.ec.europa.eu/repository/handle/JRC104106
DOI: 10.2760/528796
Type: EUR - Scientific and Technical Research Reports
Abstract: The macroeconomic experience of the last decade stressed the importance of jointly studying the growth and business cycle fluctuations behavior of the economy. To analyze this issue, we embed a model of Schumpeterian growth into an estimated medium-scale DSGE model. Results from a Bayesian estimation suggest that investment risk premia are a key driver of the slump following the Great Recession. Endogenous innovation dynamics amplifies financial crises and helps explain the slow recovery. Moreover, financial conditions also account for a substantial share of R&D investment dynamics.
JRC Directorate:Growth and Innovation

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