Download This PaperMarkups’ Cyclical Behavior: The Role of Demand and Supply Shocks
ISEG Economics Department Working Paper No. WP08/2015/DE/UECE
9 Pages Posted: 8 May 2015
Date Written: April 27, 2015
Abstract
We assess how demand and supply shocks (identified via the Blanchard and Quah (1989) SVAR approach) in 14 OECD countries affect mark-ups. We find that individual responses of markups to demand shocks push down the markup for most countries (confirmed in the panel analysis). On the other hand, a supply shock has a more mixed effect.
Keywords: Blanchard-Quah, mark-up, VAR, impulse response function, local projection
JEL Classification: C23, E32, E62
Suggested Citation: Suggested Citation
Afonso, António and Jalles, João Tovar, Markups’ Cyclical Behavior: The Role of Demand and Supply Shocks (April 27, 2015). ISEG Economics Department Working Paper No. WP08/2015/DE/UECE , Available at SSRN: https://ssrn.com/abstract=2599667 or http://dx.doi.org/10.2139/ssrn.2599667
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