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Infrequent Shocks, Output Persistence and Economic Growth
Author(s) -
Caruso Massimo
Publication year - 2004
Publication title -
the manchester school
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.361
H-Index - 42
eISSN - 1467-9957
pISSN - 1463-6786
DOI - 10.1111/j.1467-9957.2004.00391.x
Subject(s) - economics , business cycle , persistence (discontinuity) , robustness (evolution) , econometrics , classification of discontinuities , convergence (economics) , macroeconomics , mathematics , engineering , mathematical analysis , biochemistry , geotechnical engineering , gene , chemistry
The robustness of the relationship between the persistence of output fluctuations and trend growth is evaluated. The analysis introduces discontinuities in output processes and examines the role of convergence across countries. Breaking trends influence the world distribution of permanent shocks and evidence is presented on persistent differences in output patterns associated with both the catching‐up process and technological progress. Overall, a positive correlation between output persistence and growth is confirmed. These results indicate that documenting and interpreting how the characteristics of the business cycle are related to long‐run growth is an important topic that deserves further attention in the profession.