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We have updated our working paper, “The Cyclical Behavior of the Price-Cost Markup.” This version will presented at the 2010 International Research Forum on Monetary Policy on March 26-27, 2010.
You can download a copy of the paper from the link above or on my Research page.
Valerie Ramey and I have posted a draft of our new working paper, “Industry Evidence on the Effects of Government Spending,” which we will be presenting at the AEA meetings this weekend. In it we study how industry-level government spending effects output, hours, wages, and productivity.
This paper investigates industry-level effects of government purchases in order to shed light on the transmission mechanism for government spending on the aggregate economy. We begin by highlighting the different theoretical predictions concerning the effects of government spending on industry labor market equilibrium. We then create a panel data set that matches output and labor variables to shifts in industry-specific government demand. The empirical results indicate that increases in government demand raise output and hours, but have no effect on real product wages, even over a five-year horizon. Government demand also appears to raise productivity and markups when they are measured using gross output. These results are inconsistent with standard neoclassical and New Keynesian models of government spending.
You can download a copy of the paper from the link above or on my Research page.
Valerie and I will be presenting our paper “Industry Evidence on the Effects of Government Spending” at the 2010 AEA meetings on Monday, January 4th. Here is the information about the session:
Jan. 4, 2:30 pm, Atlanta Marriott Marquis, Marquis Ballroom – Salon D
AEA
Fiscal Stabilization Policy (E6)
Presiding: STEVEN DAVIS, University of Chicago
ROBERT BARRO, Harvard University, CHARLES REDLICK, Harvard University – Fiscal Multipliers
GARY BECKER, University of Chicago, KEVIN M. MURPHY, University of Chicago, ROBERT H. TOPEL, University of Chicago – Evaluating the Fiscal Stimulus
CHRISTOPHER J. NEKARDA, Federal Reserve Board, VALERIE A. RAMEY, University of California-San Diego – Industry Evidence on the Effects of Government Spending
MICHAEL WOODFORD, Columbia University – Simple Analytics of the Government Expenditure Multiplier
Today I present my research on time aggregation bias at the GSRS. The talk is cleverly titled “Estimating Time Aggregation Bias”. The seminar is at 10:00 in 244 Sequoyah.
I am presenting several papers on labor force participation in matching models at this week’s macro lunch seminar. I will be discussing Blanchard and Diamond (1990, BPEA no. 2), Garibaldi and Wasmer (2005, Journal of the European Economic Association 3(4)), and Haefke and Reiter (2006, IZA discussion paper 2029).
I will also present some new data on labor force participation and the business cycle. The seminar is Wednesday (22 Feb) from 12:30-13:30 in 244 Sequoyah.