NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

Do Equilibrium Real Business Cycle Theories Explain Post-War U.S. Business Cycles?

Martin S. Eichenbaum, Kenneth J. Singleton

NBER Working Paper No. 1932
Issued in May 1986
NBER Program(s):   EFG

This paper presents and interprets some new evidence on the validity of the Real Business Cycle approach to business cycle analysis. The analysis is conducted in the context of a monetary business cycle model which makes explicit one potential link between monetary policy and real allocations. This model is used to interpret Granger causal relations between nominal and real aggregates. Perhaps the most striking empirical finding is that money growth does not Granger cause output growth in the context of several multivariate VARs and for various sample periods during the post war period in the U.S. Several possible reconciliations of this finding with both real and monetary business cycles models are discussed. We find that it is difficult to reconcile our empirical results with the view that exogenous monetary shocks were an important independent source of variation in output growth.

download in pdf format
   (711 K)

download in djvu format
   (471 K)

email paper

This paper is available as PDF (711 K) or DjVu (471 K) (Download viewer) or via email.

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w1932

Published:

Users who downloaded this paper also downloaded these:
Eichenbaum and Singleton Do Equilibrium Real Business Cycle Theories Explain Postwar U.S. Business Cycles?
McCallum w2480 Real Business Cycle Models
Eichenbaum w3432 Real Business Cycle Theory: Wisdom or Whimsy?
Rebelo w11401 Real Business Cycle Models: Past, Present, and Future
Garcia Cicco, Pancrazi, and Uribe w12629 Real Business Cycles in Emerging Countries?
 
Publications
Activities
Meetings
NBER Videos
Data
People
About

Support
National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us