1,720,962 research outputs found
Macroeconomic Effects of Firms' Underspending in Times of Abundant Credit
No full textFirms typically decide their financing before starting the implementation of a new project. The firm's management may become more pessimistic about the project's profitability after financing is raised and reduce spending accordingly. Following an unpredicted negative aggregate productivity shock, the productive sector can enter a low spending mode, thus depressing output further. I use firm-level financial data to provide some empirical justification for this mechanism. I then study the mechanism in a general equilibrium model with money and a supply sector subject to uninsured idiosyncratic productivity shocks. The model reproduces many features of the post-2008 period: large effects of real shocks on output and investment, a less effective expansive monetary policy that is accompanied by high shareholders cash payouts
Financing time frictions and macroeconomic outcomes
No full textThis thesis considers several frictions related to the uncertainty firms face when they raise financing to fund future production projects. Following shocks to factors affecting the firm's profitability between the financing stage and the spending stage, the firm's managers may choose to spend less than the amount decided upon at the time of financing (underspending mechanism). Or, if the firm's revenues do not cover the amount due to debtors as a result of the shock, the firm might decide to default on existing debt obligation (endogenous default mechanism). Chapter 2 studies the underspending mechanism in the context of a Real Business Cycle model. This study is then extended to the case of an economy with multiple industries linked through an input-output network (chapter 3). Chapter 4 provides firm level empirical evidence to the underspending mechanism studied in chapter 2. This is achieved by linking some of the firm's growth indicators - firm level total factor productivity in particular - to the equity holders' cash rewards. The theoretical study of the underspending mechanism, links underspending to the level of shocks experienced by the economy and the cost of servicing current debt. Simulation results illustrate the asymmetric effect of underspending and the role it plays in worsening the lows of the business cycle. The aggregation results of chapter 3 prove that the underspending effects remain significant in economies with large number of industries affected by independent shocks, if the provision of intermediary goods is dominated by a small number of industries.
Chapter 5 is dedicated to modelling endogenous defaults in an RBC set-up. This chapter presents a model able to endogenously generate countercyclical default rates and credit spreads in line with empirical experience, a feature that is lacking in popular financial acceleration general equilibrium models
Macroeconomic effects of firms’ underspending in times of abundant credit
No full textFirms typically decide their financing before starting the implementation of a new project. The firm’s management may become more pessimistic about the project’s profitability after financing is raised and reduce spending accordingly. Following an unpredicted negative aggregate productivity shock, the productive sector can enter a low spending mode, thus depressing output further. I use firm-level financial data to provide some empirical justification for this mechanism. I then study the mechanism in a general equilibrium model with money and a supply sector subject to uninsured idiosyncratic productivity shocks. The model reproduces many features of the post-2008 period: large effects of real shocks on output and investment, a less effective expansive monetary policy that is accompanied by high shareholders cash payouts
Credit Markets, Intermediate Production and the Business Cycle
No full textThis paper builds an RBC model with an endogenous mechanism for firm defaults andcredit spreads. The model assumes a productive sector made of a class of intermediate producers and a class of final producers. The intermediate producers borrow to fund their operations and can default when large enough negative shocks affect their revenues. The intermediate/final production structure implies that during periods of low economicactivity, the demand for the intermediate good is lower. This depresses the price of theintermediate good and in turn depresses the revenues of the borrowing firms. Hence, higher default rates during the lows of the business cycle. Inversely, default rates are lower whenthe economy is improving: default rates are countercyclical. Intermediate producers are financed by banks that take future defaults into account when setting lending rates. This guarantees that credit spreads are countercyclical too
Credit markets, intermediate production and the business cycle
No full textThis paper builds an RBC model with an endogenous mechanism for firm defaults and credit spreads. The model assumes a productive sector made of a class of intermediate producers and a class of final producers. The intermediate producers borrow to fund their operations and can default when large enough negative shocks affect their revenues. The intermediate/final production structure implies that during periods of low economic activity, the demand for the intermediate good is lower. This depresses the price of the intermediate good and in turn depresses the revenues of the borrowing firms. Hence, higher default rates during the lows of the business cycle. Inversely, default rates are lower when the economy is improving: default rates are countercyclical. Intermediate producers are financed by banks that take future defaults into account when setting lending rates. This guarantees that credit spreads are countercyclical too
Understanding UK productivity using a macroeconomic lens
No full textWe survey UK labour productivity over the long run, comparing it with other advanced
economies, and focus on the sharp slowdown since the global financial crisis. Using a growth
accounting framework, we highlight the primary role of total factor productivity (TFP),
while noting that the contribution of capital shallowing is influenced by methodological
choices. We assess the UK’s productivity performance through standard neoclassical models
and revisit the secular stagnation debate. Long-term trends, including a 30-year decline in
real interest rates and increased labour supply since 2008 ought to have spurred investment,
and yet private and public investment as a share of GDP has declined. The economic
literature points to poor TFP growth, government decisions on public investment, flexible
labour supply, heightened uncertainty and the distortion of investment decisions in an era
of ultra-low interest rates as probable culprits behind the disappointing investment trends
Going Beyond Counting First Authors in Author Co-citation Analysis
No full textThe present study examines one of the fundamental aspects of author co-citation analysis (ACA) - the way co-citation
counts are defined. Co-citation counting provides the data on which all subsequent statistical analyses and mappings
are based, and we compare ACA results based on two different types of co-citation counting - the traditional type that
only counts the first one among a cited work's authors on the one hand and a non-traditional type that takes into
account the first 5 authors of a cited work on the other hand. Results indicate that the picture produced through this non-traditional author co-citation counting contains more coherent author groups and is therefore considerably clearer. However, this picture represents fewer specialties in the research field being studied than that produced through the traditional first-author co-citation counting when the same number of top-ranked authors is selected and analyzed. Reasons for these effects are discussed
Variations on the Author
No full text“Variations on the Author” discusses two of Eduardo Coutinho’s recent films (Um Dia na Vida, from 2010, and Últimas Conversas, posthumously released in 2015) and their contribution to the general question of documentary authorship. The director’s filmography is characterized by a consistent yet self-effacing form of authorial self-inscription: Coutinho often features as an interviewer that rather than express opinions propels discourses; an interviewer that is good at listening. This mode of self-inscription characterizes him as an author who is not expressive but who is nonetheless markedly present on the screen. In Um Dia na Vida, however, Coutinho is completely absent form the image, while Últimas Conversas, on the contrary, includes a confessional prologue that moves the director from the margins to the center of his films. This article examines the ways in which these works stand out in the filmography of a director who offers new insights into the notion of cinematic authorship
Appropriate Similarity Measures for Author Cocitation Analysis
No full textWe provide a number of new insights into the methodological discussion about author cocitation analysis. We first argue that the use of the Pearson correlation for measuring the similarity between authors’ cocitation profiles is not very satisfactory. We then discuss what kind of similarity measures may be used as an alternative to the Pearson correlation. We consider three similarity measures in particular. One is the well-known cosine. The other two similarity measures have not been used before in the bibliometric literature. Finally, we show by means of an example that our findings have a high practical relevance.information science;Pearson correlation;cosine;similarity measure;author cocitation analysis
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