Medium Frequencies in Non-Frontier Economies
Type
working paper
Date Issued
2018-11
Author(s)
Abstract
Most countries in the world are not at the technological frontier, yet their economies grow and fluctuate. In this paper we set up a model of endogenous growth with business cycle fluctuations usable to analyze the medium frequency fluctuations in non-frontier countries. The growth mechanism is a Schumpeterian creative destruction framework, which is embedded into a real business cycle dynamic stochastic general equilibrium model, with standard and non-standard features. We allow for multinational firms entering the economy and challenging existing incumbents, and study the tension between their direct positive productivity contribution and their indirect negative contribution through the expected obsolescence of domestic innovators. We calibrate the model and show, via simulations, the potential value added from our prototype model.
Language
English
Keywords
DSGE and growth
Medium Frequencies
Non-frontier Economies.
HSG Classification
contribution to scientific community
HSG Profile Area
SEPS - Economic Policy
Subject(s)
Eprints ID
255917
File(s)![Thumbnail Image]()
open.access
Name
Medium_frequencies_NFE_BCG.pdf
Size
626.62 KB
Format
Adobe PDF
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