Productivity Growth, Consumer Confidence and the Business Cycle

CEPR Discussion Paper Series No. 1779

Posted: 25 Jun 1998

See all articles by Jean-Pierre Danthine

Jean-Pierre Danthine

University of Lausanne - Institute of Banking and Finance (IBF); Centre for Economic Policy Research (CEPR); Swiss Finance Institute

John B. Donaldson

Columbia Business School - Finance and Economics

Thore Johnsen

Norwegian School of Economics (NHH) - Department of Finance

Date Written: January 1998

Abstract

The objective of this paper is to provide, in the context of a dynamic general equilibrium model, an answer to the following five questions: 1) To what extent does an economy subject to regular variations in labor productivity growth differ from one where labor productivity is constant? 2) What is the impact on major macroeconomic indicators of a one-time change in labor productivity growth? 3) What are the business cycle implications of autonomous (non-falsifiable) changes in growth expectations? 4) What is the potential of such expectation changes for explaining the volatility of consumption to output ratio? 5) Can autonomous changes in growth expectations help us understand recent business cycle episodes?

JEL Classification: E1, E2, E32

Suggested Citation

Danthine, Jean-Pierre and Donaldson, John B. and Johnsen, Thore, Productivity Growth, Consumer Confidence and the Business Cycle (January 1998). CEPR Discussion Paper Series No. 1779, Available at SSRN: https://ssrn.com/abstract=101928

Jean-Pierre Danthine (Contact Author)

University of Lausanne - Institute of Banking and Finance (IBF) ( email )

Lausanne, 1015
Switzerland
+41 21 692 3485 (Phone)
+41 21 692 3335 (Fax)

HOME PAGE: http://www.hec.unil.ch/jdanthine/

Centre for Economic Policy Research (CEPR)

London
United Kingdom

Swiss Finance Institute ( email )

c/o University of Geneve
40, Bd du Pont-d'Arve
1211 Geneva, CH-6900
Switzerland

John B. Donaldson

Columbia Business School - Finance and Economics ( email )

3022 Broadway
New York, NY 10027
United States

Thore Johnsen

Norwegian School of Economics (NHH) - Department of Finance ( email )

Helleveien 30
N-5045 Bergen
Norway

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