Paper #1013

Title:

On the robust effects of technology shocks on hours worked and output

Authors:

Fabio Canova, David López-Salido and Claudio Michelacci

Date:

November 2006 (Revised: February 2008)

Abstract:

We analyze the effects of neutral and investment-specific technology shocks on hours and output. Long cycles in hours are captured in a variety of ways. Hours robustly fall in response to neutral shocks and robustly increase in response to investment specific shocks. The percentage of the variance of hours (output) explained by neutral shocks is small (large); the opposite is true for investment specific shocks. ‘News shocks’ are uncorrelated with the estimated technology shocks.

Keywords:

Technology disturbances, structural VARs, low frequency movements, news shocks

JEL codes:

E00, J60, O33

Published in:

Journal of Applied Econometrics, forthcoming
With the title:
The Effects of Technology Shocks on Hours and Output: A Robustness Analysis

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