Ramey, Valerie A, Francis, Neville
In this paper we re-examine the recent evidence that technology shocks do not produce business cycle patterns in the data. We first extend Gali's (1999) work, which uses long-run restrictions to...
Market Responses to Interindustry Wage Differentials (2000)
BORJAS, GEORGE J, Ramey, Valerie A
This paper examines the link between interindustry wage differentials and subsequent growth of industry variables such as employment, GDP and labor productivity. We find that industries that paid...
The Cost Channel of Monetary Transmissions (2000)
Barth, Marvin J, Ramey, Valerie A
This paper presents evidence that the "cost channel" may be an important part of the monetary transmission mechanism. We argue that if working capital is an essential component of production and...
DISPLACED CAPITAL: A Study of Aerospace Plant Closings (2000)
Valerie A. Ramey, Matthew D. Shapiro
Using equipment-level data from aerospace plants that closed during the 1990s, this paper studies the process of moving installed physical capital to a new use. The analysis yields three results that...
Market Responses to Interindustry Wage Differentials (2000)
George J. Borjas, Valerie A. Ramey, George J. Borjas, Valerie A. Ramey, George J. Borjas, Valerie A. Ramey
Both authors thank the National Science Foundation for research support. Ramey also thanks the Sloan Foundation for research support. This paper examines the link between interindustry wage...
Ramey, Valerie A, SHAPIRO, MATTHEW D
This paper studies the efficiency with which physical capital can be reallocated across sectors. It presents a model of a firm selling specialized capital in a thin resale market. The model predicts...
Michael J. Geske, Valerie A. Ramey, Matthew D. Shapiro
The value of installed computers falls rapidly and therefore computers have a very high user cost. The paper provides a complete account of the non-financial user cost of personal computers --...
Displaced Capital: A Study of Aerospace Plant Closings
Valerie A. Ramey, Matthew D. Shapiro
Using equipment-level data from aerospace plants that closed during the 1990s, this paper studies the process of moving installed physical capital to a new use. The analysis yields three results that...
How Important is the Credit Channel in the Transmission of Monetary Policy?
This paper empirically tests the importance of the credit channel in the transmission of monetary policy. Three credit variables are analyzed: total bank loans, bank holdings of securities relative...
Is the Technology-Driven Real Business Cycle Hypothesis Dead?
Neville Francis, Valerie A. Ramey
In this paper, we re-examine the recent evidence that technology shocks do not produce business cycle patterns in the data. We first extend Gal¡'s (1999) work, which uses long-run restrictions to...
Declining Volatility in the U.S. Automobile Industry
Valerie A. Ramey, Daniel J. Vine
Dramatic changes in the volatility of output occurred in the U.S. auto industry in the early 1980s. Namely, output volatility declined, the covariance of inventory investment and sales grew more...
Technology Commitment and the Cost of Economic Fluctuations
When firms must make technology commitments, economic fluctuations impose costs in the form of ex post inefficiency in production technology. We present a general equilibrium model in which, due to...
The Source of Fluctuations in Money: Evidence From Trade Credit
This paper tests the importance of technology shocks versus financial shocks for explaining, fluctuations in money. The model presented extends the theory of King and Plosser by recognizing that both...
Eun Young Chah, Valerie A. Ramey, Ross M. Starr
This paper develops and tests a new set of stochastic implications of optimal consumption behavior in the presence of borrowing constraints. In a departure from previous models, the theory shows that...
Output Fluctuations at the Plant Level
Timothy F. Bresnahan, Valerie A. Ramey
This paper studies weekly output fluctuations from 1972 to 1983 at fifty final assembly plants in the U.S. automobile industry. The study makes use of a new data set that contains detailed...
Stochastic Trends and Short-Run Relationships Between Financial Variables and Rela Activity
Toru Konishi, Valerie A. Ramey
This paper re-examines the relationship between financial variables and real activity in a unified statistical framework. Using the methods of cointegration and separation. we characterize the...
Foreign Competition, Market Power and Wage Inequality: Theory and Evidence
George J. Borjas, Valerie A. Ramey
In this paper, we present theory and evidence on the link between wage inequality and foreign competition in concentrated industries. We develop a simple model in which the impact of foreign...
Cross-Country Evidence on the Link Between Volatility and Growth
This paper presents empirical evidence against the standard dichotomy in macroeconomics that separates growth from the volatility of economic fluctuations. In a sample of 92 countries as well as a...
Valerie A. Ramey, Kenneth D. West
We review and interpret recent work on inventories, emphasizing empirical and business cycle aspects. We begin by documenting two empirical regularities about inventories. The first is the well-known...
Valerie A. Ramey, Matthew D. Shapiro
This paper studies the efficiency with which physical capital can be reallocated across sectors. It presents a model of a firm selling specialized capital in a thin resale market. The model predicts...
Costly Capital Reallocation and the Effects of Government Spending
Valerie A. Ramey, Matthew D. Shapiro
Changes in government spending often lead to significant shifts in demand across sectors. This paper analyzes the effects of sector-specific changes in government spending in a two-sector dynamic...
The Cost Channel of Monetary Transmission
This paper presents evidence that the cost channel' may be an important part of the monetary transmission mechanism. We argue that if working capital is an essential component of production and...
Market Responses to Interindustry Wage Differentials
George J. Borjas, Valerie A. Ramey
This paper examines the link between interindustry wage differentials and subsequent growth of industry variables such as employment, GDP and labor productivity. We find that industries that paid...
Tracking the Source of the Decline in GDP Volatility: An Analysis of the Automobile Industry
Valerie A. Ramey, Daniel J. Vine
Recent papers by Kim and Nelson (1999) and McConnell and Perez-Quiros (2000) uncover a dramatic decline in the volatility of U.S. GDP growth beginning in 1984. Determining whether the source is good...
The Source of Historical Economic Fluctuations: An Analysis using Long-Run Restrictions
Neville Francis, Valerie A. Ramey
This paper investigates the source of historical fluctuations in annual US data extending back to the late 19th century. Long-run identifying restrictions are used to decompose productivity, hours,...
Why Do Real and Nominal Inventory-Sales Ratios Have Different Trends
Valerie A. Ramey, Daniel J. Vine
This note explains the diverging trends between real and nominal aggregate inventory-sales ratios. The combined effect of two features of the data explains the divergence. First, while aggregate...
Declining Volatility in the U.S. Automobile Industry
Valerie A. Ramey, Daniel J. Vine
This paper documents the dramatic changes in volatility that occurred in the U.S. auto industry in the early 1980s. Namely, output volatility declined significantly, the covariance of inventory...
Measures of Per Capita Hours and their Implications for the Technology-Hours Debate
Neville Francis, Valerie A. Ramey
Structural vector autoregressions give conflicting results on the effects of technology shocks on hours. The results depend crucially on the assumed data generating process for hours per capita. We...
Valerie A. Ramey, Neville Francis
Has leisure increased over the last century? Standard measures of hours worked suggest that it has. In this paper, we develop a comprehensive measure of non-leisure hours that includes market work,...
Nonconvex Costs and the Behavior of Inventories.
This paper explores one possible explanation for the apparent excess volatility of production relative to sales: nonconvexities in the technology facing firms. It is shown that if firms operated in a...
Time Spent in Home Production in the Twentieth-Century United States: New Estimates from Old Data
This article presents new estimates of time spent in home production in the United States during the twentieth century. Historical time-diary studies for various segments of the population are linked...
After three decades of decline, the amount of time spent by parents on childcare in the U.S. began to rise dramatically in the mid-1990s. Moreover, the rise in childcare time was particularly...
Valerie A. Ramey, Neville Francis
We develop comprehensive measures of time spent in market work, home production, schooling, and leisure in the United States for the last 106 years. We find that hours of work for prime age...
Measures of per Capita Hours and Their Implications for the Technology-Hours Debate
NEVILLE FRANCIS, VALERIE A. RAMEY
Structural vector autoregressions give conflicting results on the effects of technology shocks on hours. The results depend crucially on the assumed data generating process for hours per capita. We...
Identifying Government Spending Shocks: It's All in the Timing
Do shocks to government spending raise or lower consumption and real wages? Standard VAR identification approaches show a rise in these variables, whereas the Ramey-Shapiro narrative identification...