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Replication data for: The Brevity and Violence of Contractions and Expansions

Harvard Dataverse (Africa Rice Center, Bioversity International, CCAFS, CIAT, IFPRI, IRRI and WorldFish)

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Title Replication data for: The Brevity and Violence of Contractions and Expansions
 
Identifier https://doi.org/10.7910/DVN/B02C57
 
Creator Ricardo Reis
Alisdair McKay
 
Publisher Harvard Dataverse
 
Description Early studies of business cycles argued that contractions in economic activity were briefer (shorter) and more violent (rapid) than expansions. This paper systematically investigates this claim and in the process discovers a robust new business cycle fact: expansions and contractions in output are equally brief and violent but contractions in employment are briefer and more violent than expansions. The difference arises because employment typically lags output around peaks but both series roughly coincide in their troughs. We discuss the performance of existing business cycle models in accounting for this fact, and conclude that none can fully account for it. We then show that a simple model that combines three familiar ingredients--labor hoarding, a choice of when to scrap old technologies, and job training or job search--can account for the business cycle fact.
 
Subject Business cycles
Economic expansions and contractions
Asymmetric cycles
Unemployment
 
Date 2008