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Bank of Canada RSS Feedsen2024-03-28T16:06:24+00:00Persistent Debt and Business Cycles in an Economy with Production Heterogeneity
https://www.bankofcanada.ca/2023/03/staff-working-paper-2023-17/
We examine the role of debt in amplifying and propagating recessions. Firms’ debt adjustment makes recessions deeper but makes expansions gradual. In particular, when the aggregate business leverage is ten percentage points above average, the half-life of the recovery doubles.2023-03-13T13:09:10+00:00enPersistent Debt and Business Cycles in an Economy with Production Heterogeneity2023-03-13Business fluctuations and cyclesFirm dynamicsProductivityStaff Working Paper 2023-17https://www.bankofcanada.ca/wp-content/uploads/2023/03/swp2023-17.pdfStaff Working Paper 2023-17Aubhik KhanSoyoung LeeMarch 2023EE2E23E3E30E32