Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/95263 
Year of Publication: 
2012
Series/Report no.: 
Quaderni di Dipartimento No. 164
Publisher: 
Università degli Studi di Pavia, Dipartimento di Economia Politica e Metodi Quantitativi (EPMQ), Pavia
Abstract: 
Conventional RBC models have been heavily criticized for their inability to generate the estimated negative correlations of hours and productivity in response to technology shocks ('productivity-hours puzzle'). In this paper we show that by just enhancing the standard frame- work with investment adjustment costs can resolve the 'productivity-hours puzzle'.
Subjects: 
technology shocks
productivity-hours puzzle
investment adjustment costs
wealth effect
JEL: 
E22
E32
Document Type: 
Working Paper

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