Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/142466
Authors: 
Vasilev, Aleksandar
Year of Publication: 
2015
Abstract: 
This paper shows that a modified real business cycle (RBC) model, one that includes home production and fiscal spending shocks, can solve one of the RBC puzzles and generates zero correlation between wages and hours. In addition, the micro-founded model presented here provides a sound theoretical model to analyze fiscal policy in a neoclassical framework and is able to capture many aspects of the data that the benchmark RBC model was missing.
Subjects: 
fiscal policy
home production
government spending shock
indivisible labor
JEL: 
C63
E62
E32
Document Type: 
Preprint

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