Technology Shocks

Paul M. Romer

This 1990 Journal of Political Economy paper by Paul Romer models long-run growth as driven by technological change that arises from intentional research investment by profit-maximizing firms, …

David Altig · Lawrence J. Christiano · Martin Eichenbaum · Jesper Lindé

Estimated New Keynesian models reconcile inertial inflation with Calvo pricing only by forcing firms to re-optimise prices once every two years or more, which micro price data contradict. Making …

Paul M. Romer

This 1986 Journal of Political Economy paper by Paul Romer builds a fully specified competitive-equilibrium model of long-run growth in which knowledge is an input to production with increasing …

Jeremy Greenwood · Zvi Hercowitz · Gregory W. Huffman

Keynes's idea that shocks to the marginal efficiency of investment drive fluctuations is placed inside a neoclassical model in which firms choose how hard to run their capital; a shock that raises the …

Silvia Miranda-Agrippino · Sinem Hacıoğlu-Hoke · Kristina Bluwstein

This paper constructs an instrumental variable for technology news shocks using patent applications, relaxing all identifying assumptions traditionally used in the news-shock literature. The IV is the …

Lawrence J. Christiano · Richard M. Todd

Investment projects begin with a long planning phase that consumes very little in the way of resources, and building that phase into an otherwise standard real business cycle model delays the response …