Year: 2004
Type: report
Abstract: This article reviews the literature on the cost of U.S. post-War business cycle fluctuations.I argue that recent work has established this cost is considerably larger than initial work found.However, despite the large cost of macroeconomic volatility, it is not obvious that policymakers should have pursued a more aggressive stabilization policy than they did.Still, the fact that volatility is so costly suggests stable growth is a desirable goal that ought to be maintained to the extent possible, just as policymakers are currently required to do under the Balanced Growth and Full Employment Act of 1978.This survey was prepared for the Economic Perspectives, a publication of the Federal Reserve Bank of Chicago.
DOI: 10.3386/w10926
Author: Gadi Barlevy
Language: English
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W1568143181