Jump to ContentJump to Main Navigation
Show Summary Details
In This Section

The B.E. Journal of Macroeconomics

Editor-in-Chief: Cavalcanti, Tiago / Kambourov, Gueorgui

Ed. by Abraham, Arpad / Carceles-Poveda , Eva / Debortoli, Davide / Lambertini, Luisa / Nimark, Kristoffer / Wang, Pengfei

2 Issues per year


IMPACT FACTOR 2015: 0.164
5-year IMPACT FACTOR: 0.403

SCImago Journal Rank (SJR) 2015: 0.205
Source Normalized Impact per Paper (SNIP) 2015: 0.317
Impact per Publication (IPP) 2015: 0.222

Online
ISSN
1935-1690
See all formats and pricing
In This Section

What Does It Take to Explain Procyclical Productivity?

Yi Wen
  • 1Cornell University,
Published Online: 2004-06-23 | DOI: https://doi.org/10.2202/1534-6005.1180

Labor productivity comoves strongly with output, leads output and employment, and is only weakly correlated with employment. Procyclical productivity is observed in virtually all countries and industries, and it is observed even in periods of fluctuations due to pure demand shocks, such as during the Great Depression and the second World War. This paper shows that a standard RBC model driven by demand shocks alone is able to explain procyclical productivity without the need to resort to technology shocks or increasing returns to scale. The key element is labor hoarding due to adjustment cost of labor. It is also shown that the observed cross-country differences in productivity cycles can be rationalized by a single parameter alone - the size of the adjustment cost of labor.

Keywords: PRODUCTIVITY; DEMAND SHOCKS; REAL-BUSINESS-CYCLE; LABOR HOARDING; CAPACITY UTILIZATION; ADJUSTMENT COST

About the article

Published Online: 2004-06-23



Citation Information: Contributions in Macroeconomics, ISSN (Online) 1534-6005, DOI: https://doi.org/10.2202/1534-6005.1180. Export Citation

Citing Articles

Here you can find all Crossref-listed publications in which this article is cited. If you would like to receive automatic email messages as soon as this article is cited in other publications, simply activate the “Citation Alert” on the top of this page.

[1]
Pengfei Wang, Yi Wen, and Zhiwei Xu
Journal of Economic Dynamics and Control, 2014, Volume 44, Page 196

Comments (0)

Please log in or register to comment.
Log in