Working Paper: CEPR ID: DP1113
Authors: Fabio Canova; Angel J. Ubide
Abstract: This paper investigates the effects of introducing household production in an international real business cycle model. We show how a model driven by disturbances to the household production can account for some features of international cycles. A version of the model which considers shocks to both market and household technologies seems able to reproduce the main regularities of the data. Sensitivity analysis shows that the implications of the model are robust to alternative specifications of the stochastic processes for the disturbances and to variations of the parameters within a reasonable range.
Keywords: household production; international business cycles; taste shocks; consumption correlations
JEL Codes: C68; E32; F41
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| household production disturbances (D13) | international business cycles (F44) |
| household production disturbances (D13) | market consumption (F61) |
| household production disturbances (D13) | labor allocation (J22) |
| household production disturbances (D13) | market output (L19) |
| household production disturbances (D13) | investment (G31) |
| household production disturbances (D13) | imports (F14) |
| household production disturbances (D13) | exports (F10) |
| household production disturbances (D13) | comovements in labor input (J69) |
| household production disturbances (D13) | saving-investment correlations (E21) |
| household production disturbances (D13) | cross-country consumption correlations (R22) |
| household production (D13) | market consumption (F61) |
| household production (D13) | labor allocation (J22) |