In this paper, we develop and simulate an RBC model that includes intangible capital as a third factor of production. We study the effects of intra-temporal preference shocks on economic aggregates, employing the undetermined coefficient method of to solve the model. Impulse response functions...

Using a dynamic stochastic general equilibrium (DSGE) model, we examine the impact of anticipated and unanticipated terms of trade (ToT) shocks on aggregate output, inflation and the trade balance (TB). This allows us to offer an alternative explanation of the J-curve phenomenon. We find that an...