Consulta: creatorFacets:"Caballero,   Ricardo J."
Registros recuperados: 5
Data/hora: 08/06/2024 01:18:15

Adjustment is Much Slower than You Think
Provedor de dados: Research in Agricultural & Applied Economics (AgEcon Searh)
Autores: Caballero,   Ricardo J.; Engel,   Eduardo M.R.A.
In most instances, the dynamic response of monetary and other policies to shocks is infrequent and lumpy. The same holds for the microeconomic response of some of the most important economic variables, such as investment, labor demand, and prices. We show that the standard practice of estimating the speed of adjustment of such variables with partial-adjustment ARMA procedures substantially overestimates this speed. For example, for the target federal funds rate, we find that the actual response to shocks is less than half as fast as the estimated response. For investment, labor demand and prices, the speed of adjustment inferred from aggregates of a small number of agents is likely to be close to instantaneous. While aggregating across microeconomic units...
Tipo: Working or Discussion Paper
Palavras-chave: Speed of adjustment; Discrete adjustment; Lumpy adjustment; Aggregation; Calvo model; ARMA process; Partial adjustment; Expected response time; Monetary policy; Investment; Labor demand; Sticky prices; Idiosyncratic shocks; Impulse response function; Wold representation; Time-to-build; Financial Economics; C22; C43; D2; E2; E5.
Ano: 2003
URL: http://purl.umn.edu/28419

Microeconomic Flexibility in Latin America
Provedor de dados: Research in Agricultural & Applied Economics (AgEcon Searh)
Autores: Caballero,   Ricardo J.; Engel,   Eduardo M.R.A.; Micco,   Alejandro.
We characterize the degree of microeconomic inflexibility in several Latin American economies and find that Brazil, Chile and Colombia are more flexible than Mexico and Venezuela. The difference in flexibility among these economies is mainly explained by the behavior of large establishments, which adjust more promptly in the more flexible economies, especially when accumulated shocks are substantial. We also study the path of flexibility in Chile and show that it declined in the aftermath of the Asian crisis. This decline can account for a substantial fraction of the large decline in TFP-growth in Chile since 1997 (from 3.1 percent per year for the preceding decade, to about 0.3 percent after that). Moreover, if it were to persist, it could permanently...
Tipo: Working or Discussion Paper
Palavras-chave: Microeconomic rigidities; Creative-destruction; Job flows; Restructuring and reallocation; Productivity growth; Financial Economics; E2; J2; J6.
Ano: 2004
URL: http://purl.umn.edu/28527

Price Stickiness in Ss Models: New Interpretations of Old Results
Provedor de dados: Research in Agricultural & Applied Economics (AgEcon Searh)
Autores: Caballero,   Ricardo J.; Engel,   Eduardo M.R.A.
What is the relation between infrequent price adjustment and the dynamic response of the aggregate price level to monetary shocks? The answer to this question ranges from a one-to-one link (Calvo, 1983) to no connection whatsoever (Caplin and Spulber, 1987). The purpose of this paper is to provide a unified framework to understand the mechanisms behind this wide range of results. In doing so, we propose new interpretations of key results in this area, which in turn suggest the kind of Ss model that is likely to generate substantial price rigidity. The first result we revisit is Caplin and Spulber's monetary neutrality model. We show that when price stickiness is measured in terms of the impulse response function, this result is not a consequence of...
Tipo: Working or Discussion Paper
Palavras-chave: Demand and Price Analysis.
Ano: 2007
URL: http://purl.umn.edu/28423

Three Strikes and You're Out: Reply to Cooper and Willis
Provedor de dados: Research in Agricultural & Applied Economics (AgEcon Searh)
Autores: Caballero,   Ricardo J.; Engel,   Eduardo M.R.A.
Cooper and Willis (2003) is the latest in a sequence of criticisms of our methodology for estimating aggregate nonlinearities when microeconomic adjustment is lumpy. Their case is based on “reproducing” our main findings using artificial data generated by a model where microeconomic agents face quadratic adjustment costs. That is, they supposedly find our results where they should not be found. The three claims on which they base their case are incorrect. Their mistakes range from misinterpreting their own simulation results to failing to understand the context in which our procedures should be applied. They also claim that our approach assumes that employment decisions depend on the gap between the target and current level of unemployment. This is...
Tipo: Working or Discussion Paper
Palavras-chave: Adjustment hazard; Aggregate nonlinearities; Lumpy adjustment; Observed and unobserved gaps; Quadratic adjustment; Research Methods/ Statistical Methods; E2; J2; J6.
Ano: 2004
URL: http://purl.umn.edu/28498

Effective Labor Regulation and Microeconomic Flexibility
Provedor de dados: Research in Agricultural & Applied Economics (AgEcon Searh)
Autores: Caballero,   Ricardo J.; Cowan,   Devin N.; Engel,   Eduardo M.R.A.; Micco,   Alejandro.
Microeconomic flexibility, by facilitating the process of creative-destruction, is at the core of economic growth in modern market economies. The main reason for why this process is not infinitely fast is the presence of adjustment costs, some of them technological, others institutional. Chief among the latter is labor market regulation. While few economists would object to such a view, its empirical support is rather weak. In this paper we revisit this hypothesis and find strong evidence for it. We use a new sectoral panel for 60 countries and a methodology suitable for such a panel. We find that job security regulation clearly hampers the creative-destruction process, especially in countries where regulations are likely to be enforced. Moving from the...
Tipo: Working or Discussion Paper
Palavras-chave: Microeconomic rigidities; Creative-destruction; Job security regulation; Adjustment costs; Rule of law; Productivity growth; Labor and Human Capital; E24; J23; J63; J64; K00.
Ano: 2004
URL: http://purl.umn.edu/28486