Financial Frictions, Capital Misallocation, and Input-Output Linkages
2015/01/19
研討會日期 : 2015-01-19
時間 : 14:30
主講人 : Mr. Hsuan-Li Su
主持人 : Professor Yu-Chin Hsu
地點 : Conference Room B110
演講者簡介 : Mr. Hsuan-Li Su will receive his Ph.D. in Economics from University of Wisconsin-Madison in 2015. His primary research field is Macroeconomics and Secondary are Financial Economics and Networks. He is applying for a position of the Institute of Economics, AS now.
演講摘要 : This paper analyzes the role of financial frictions in amplifying impulse responses to different types of shocks and shows that input-output linkages contribute to an increase in the impact of financial frictions on the aggregate economy. Financial frictions distort the allocation of capital and induce capital wedges, which are weak under total factor productivity (TFP) shocks but strong under uncertainty shocks. As a result, in standard models driven by TFP shocks, adding financial frictions dampens the impulse responses. On the other hand, financial frictions can drive aggregate TFP fluctuations and play a crucial role when uncertainty shocks hit the economy. Adding input-output linkages can further amplify the impact. In the model calibrated to U.S. data, I quantify the amplification effects of firm linkages, demonstrating that the addition of input-output linkages amplifies the effects of both TFP and uncertainty shocks. In particular, aggregate output drops an additional 84% under TFP shocks and an additional 40% under uncertainty shocks with input-output linkages. Furthermore, compared to other sectors, an increase in the dispersion of the return to capital in the Finance sector has the largest impact on aggregate output.
