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In a televised address to the Nation on Sunday evening, August 15, 1971, President Richard Nixon announced the “temporary” suspension of the dollar’s convertibility into gold. While the dollar had struggled throughout most of the 1960s within the parity established at Bretton Woods,...
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The volatility of growth in U.S. real GDP declined dramatically in the mid-1980s. Viewed through the lens of linear autoregressive models, this phenomenon appears to be the result of a structural break in the innovation process that drives GDP fluctuations. We present an alternative model that...
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