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Durable Goods, Inter-Sectoral Linkages and Monetary Policy
(Université de Montréal. Département de sciences économiques., 2008-08)
Barsky, House and Kimball (2007) show that introducing durable goods into a sticky-price model leads to negative sectoral comovement of production following a monetary policy shock and, under certain conditions, to aggregate ...
The Effect of Public Spending on Consumption: Reconciling Theory and Evidence
(Université de Montréal. Département de sciences économiques., 2008-09)
Recent empirical evidence from vector autoregressions (VARs) suggests that public spending shocks increase (crowd in) private consumption. Standard general equilibrium models predict the opposite. We show that a standard ...