A typical (roughly) two-digit industry in the United States appears to have constant or slightly decreasing returns to scale. Three puzzles emerge, however. First, estimates tend to rise at higher levels of aggregation. Second, estimates of decreasing returns in many industries contradict...

Productivity rises in booms and falls in recessions. There are four main explanations for procyclical productivity: (i) procyclical technology shocks, (ii) widespread imperfect competition and increasing returns, (iii) variable utilization of inputs over the cycle, and (iv) resource...

China's strong growth in the midst of the Asian crisis is striking. We explore features of China's financial system that helped insulate it from the crisis, and then try to assess whether China has avoided crisis or simply deferred it. We argue that regardless of whether the Asian crisis...

Explanations of procyclical productivity playa key role in a variety of business-cycle models. Most of these models, however, explain this procyclicaIity within a representative-firm paradigm. This procedure is misleading. We decompose aggregate productivity changes into several terms, each of...