Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/185470
Authors: 
Grazzini, Jakob
Massaro, Domenico
Year of Publication: 
2018
Series/Report no.: 
CESifo Working Paper 7272
Abstract: 
We investigate the sources of the great changes in GDP volatility observed from 1966 to 2000. We develop a general equilibrium model and calibrate it to US data in order to characterize the contribution of micro level productivity shocks, inter-sectoral linkages and households' behavior to aggregate volatility. Our results show that changes in sectoral volatility played an important role in shaping volatility at the aggregate level. Moreover, asymmetries in the economic structure sometimes had an amplifying, and other times a dampening effect on aggregate volatility. We show that the different impact depends on the time-varying correlation between sectoral volatilities and the relative importance of specific sectors in the economy.
Subjects: 
business cycle
micro-macro volatility
input-output network
JEL: 
E32
E23
D57
Document Type: 
Working Paper

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