BIROn - Birkbeck Institutional Research Online

Structural booms

Phelps, E.S. and Zoega, Gylfi (2001) Structural booms. Economic Policy 16 (32), pp. 85-126. ISSN 0266-4658.

Full text not available from this repository.

Abstract

The paper proposes a new interpretation of long swings in economic activity. Instead of deviations from a trend growth path explained by misperceptions, long swings are seen as detours in the path itself provoked by rare and deep changes in expectations of future productivity. And such changes are approximately captured by swings in stock markets. In a large sample of OECD countries, the paper finds long‐term historical relationships between share prices and employment or the rate of unemployment. The results suggest that the recent strength of a nation’s stock markets and the responsiveness of employment are related to its institutions. In particular, corporatist institutions are likely to impede or obstruct entrepreneurs from taking advantage of expected productivity improvements. In contrast, a well‐developed stock market – in addition to a young, well‐educated labour force – may help both in the creation of profit opportunities as well as in enabling and emboldening firms to increase hiring.

Metadata

Item Type: Article
School: Birkbeck Faculties and Schools > Faculty of Business and Law > Birkbeck Business School
Depositing User: Sarah Hall
Date Deposited: 08 Dec 2020 09:45
Last Modified: 02 Aug 2023 18:06
URI: https://eprints.bbk.ac.uk/id/eprint/42015

Statistics

6 month trend
0Downloads
6 month trend
0Hits

Additional statistics are available via IRStats2.

Archive Staff Only (login required)

Edit/View Item
Edit/View Item