A neoclassical perspective on Switzerland’s 1990s stagnation

Stucki, Yannic; Thomet, Jacqueline (18 June 2018). A neoclassical perspective on Switzerland’s 1990s stagnation (Discussion Papers 18-18). Bern: Department of Economics

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We study Switzerland’s 1990s growth weakness through the lens of the business cycle accounting framework by Chari, Kehoe, and McGrattan (2007). Our main result is that weak productivity growth cannot account for the experienced stagnation. Rather, the stagnation is explained by factors that made labor and investment expensive. We show that an increase in labor income taxes and financial frictions are plausible causes. Holding these factors constant, counterfactual real annualized output growth over the 1992Q1–1996Q4 period is 1.93%, compared to a realized growth of 0.35%.

Item Type:

Working Paper

Division/Institute:

03 Faculty of Business, Economics and Social Sciences > Department of Economics

UniBE Contributor:

Stucki, Yannic and Thomet, Jacqueline Lea

Subjects:

300 Social sciences, sociology & anthropology > 330 Economics

Series:

Discussion Papers

Publisher:

Department of Economics

Language:

English

Submitter:

Lars Tschannen

Date Deposited:

03 Sep 2020 08:15

Last Modified:

03 Sep 2020 08:15

JEL Classification:

E13, E20, E32, E65

BORIS DOI:

10.7892/boris.145870

URI:

https://boris.unibe.ch/id/eprint/145870

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