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ERIC Number: EJ771297
Record Type: Journal
Publication Date: 2007
Pages: 14
Abstractor: Author
ISBN: N/A
ISSN: ISSN-0022-0485
EISSN: N/A
Loglinear Approximate Solutions to Real-Business-Cycle Models: Some Observations
Lau, Sau-Him Paul; Ng, Philip Hoi-Tak
Journal of Economic Education, v38 n2 p194-207 Spr 2007
Following the analytical approach suggested in Campbell, the authors consider a baseline real-business-cycle (RBC) model with endogenous labor supply. They observe that the coefficients in the loglinear approximation of the dynamic equations characterizing the equilibrium are related to the fundamental parameters in a relatively simple manner. These equations can be used to obtain the closed-form approximate solution with ease and to demonstrate the properties (uniqueness) of the solution with clarity. Furthermore, comparative static results can be confirmed analytically (by straightforward differentiation). Most of these conclusions can be generalized to more complicated RBC models. (Contains 8 notes and 1 table.)
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Publication Type: Journal Articles; Reports - Research
Education Level: Higher Education
Audience: N/A
Language: English
Sponsor: N/A
Authoring Institution: N/A
Grant or Contract Numbers: N/A