skip to content

Faculty of Economics

Journal Cover

Holly, S. and Petrella, I.

Factor demand linkages, technology shocks and the business cycle

Review of Economics and Statistics

Vol. 94(4) no. 4 pp. 948-963 (2012)

Abstract: his paper argues that factor demand linkages can be important for the transmission of both sectoral and aggregate shocks. We show this using a panel of highly disaggregated manufacturing sectors together with sectoral structural VARs. When sectoral interactions are explicitly accounted for, a contemporaneous technology shock to all manufacturing sectors implies a positive response in both output and hours at the aggregate level. Otherwise there is a negative correlation, as in much of the existing literature. Furthermore, we find that technology shocks are important drivers of the business cycle.

Author links: Sean Holly  

Publisher's Link:

Papers and Publications

Recent Publications

Jochmans, K. and Weidner, M. Fixed-Effect Regressions on Network Data Econometrica [2019]

Faraglia, E., Marcet, A., Oikonomou, R. and Scott, A. Government Debt management: the Short and the Long of it Review of Economic Studies [2019]

Dziubinski, M., Goyal, S. and Minarsch, D. E. N. The Strategy of Conquest Journal of Economic Theory, forthcoming [2020]

Linton, O. A coupled component DCS-EGARCH model for intraday and overnight volatility Journal of Econometrics [2020]