Lumpy consumer durables, market power, and endogenous business cycles

Kala Krishna, Cemile Yavas

Research output: Contribution to journalArticlepeer-review

2 Scopus citations

Abstract

In this paper we show that lumpy consumer durables and market power can generate endogenous cycles consistent with the facts. Past sales determine the current market size of durable goods. Larger past sales, ceteris paribus, thus naturally result in a smaller current market size and income. In this manner, the seeds of a downturn are sown in an upturn.

Original languageEnglish (US)
Pages (from-to)375-391
Number of pages17
JournalCanadian Journal of Economics
Volume37
Issue number2
DOIs
StatePublished - May 2004

All Science Journal Classification (ASJC) codes

  • Economics and Econometrics

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