Institutional Affiliation: Department of Economics - University of Chile
with Norman Loayzaw, : w10584
Economies respond differently to aggregate shocks that reduce output. While some countries rapidly recover their pre-crisis trend, others stagnate. Recent studies provide empirical support for a link between aggregate growth and plant dynamics through its effect on productivity: the entry and exit of firms and the reallocation of resources from less to more efficient firms explain a relevant part of transitional productivity dynamics. In this paper we use a stochastic general equilibrium model with heterogeneous firms to study the effect on aggregate short-run growth of policies that distort the process of birth, growth and death of firms, as well as the reallocation of resources across economic units. Our findings show that indeed policies that alter plant dynamics can explain slow recove...
Published: Bergoeing, Raphael & Loayza, Norman & Repetto, Andrea, 2004. "Slow recoveries," Journal of Development Economics, Elsevier, vol. 75(2), pages 473-506, December. citation courtesy of
|Policy-Driven Productivity in Chile and Mexico in the 1980s and 1990s|
with , , Raimundo Soto: w8892
Both Chile and Mexico experienced severe economic crises in the early 1980s, but Chile recovered much faster than did Mexico. Using growth accounting and a calibrated dynamic general equilibrium model, we conclude that the crucial determinant of this difference between the two countries was the faster productivity growth in Chile, rather than higher investment or employment. Our hypothesis is that this difference in productivity was driven by earlier policy reforms in Chile, the most crucial of which were in banking and bankruptcy procedures. We propose a theoretical framework in which government policy affects both the allocation of resources and the composition of firms.
Published: Bergoeing, Raphael, Patrick J. Kehoe, Timothy J. Kehoe and Raimundo Soto. "Policy-Driven Productivity In Chile And Mexico In The 1980's And 1990's," American Economic Review, 2002, v92(2,May), 16-21. citation courtesy of
|A Decade Lost and Found: Mexico and Chile in the 1980s|
with , , Raimundo Soto: w8520
Chile and Mexico experienced severe economic crises in the early 1980s. This paper analyzes four possible explanations for why Chile recovered much faster than did Mexico. Comparing data from the two countries allows us to rule out a monetarist explanation, an explanation based on falls in real wages and real exchange rates, and a debt overhang explanation. Using growth accounting, a calibrated growth model, and economic theory, we conclude that the crucial difference between the two countries was the earlier policy reforms in Chile that generated faster productivity growth. The most crucial of these reforms were in banking and bankruptcy procedures.
Published: Bergoeing, Raphael, Patrick J. Kehoe, Timothy J. Kehoe and Raimundo Soto. "A Decade Lost And Found: Mexico And Chile In The 1980s," Review of Economic Dynamics, 2002, v5(1,Jan), 166-205. citation courtesy of