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M.Com. / In this treatise, research is done into the various theories with regard to the business phenomenon and the various phases of the business cycle according to various economic indicators. A characteristic of the South African economy as well as other capitalistic systems, is that business indicators have a unstable tendency. Times of prosperity are followed by times of recession when unemployment, production, prices, profits and economic welfare, decline. The recession is again followed by times of prosperity which are characterised by increases in job opportunities as well as rising prices, profits and living standards. This wave like movement in economic activity is known as the business phenomenon. There are certain forces which directly affect the business cycle - some of them force it upwards while others force it downwards. The direction of the business cycle depends on the dominant forces. As soon as the forces are exhausted, a turn in the cycle results. The series regarding the business cycle are classified according to specific schools of thought in order to investigate their development as well as the main causes of the wave like motion in economic activities. A simple classification can be made by dividing the theories into those which preceded the publication of J.M. Keynes' General Theory of Employment, Interest and Money in 1936 as the Classical or Pre-Keynesian, and those which form the Keynesian school of thought and which appeared since the thirties as the Post-Keynesian theories. Firstly the Pre-Keynesian business cycle theories are discussed with reference to amongst others the demand theories, supply theories, the monetary theories and. the impulse theories. Thereafter the Post-Keynesian business cycle theories are discussed, that is those of Hicks, Kalecki, Goodwin and Duesenberry. An examination of the different phases of the business cycle implies a study of the movement of economic data in a upward and downward direction. Four phases can be discerned within the business cycle namely: the upward phase, the upper turning point, the downward phase and the lower turning point. The position of the various indicators will determine in which phase a country's economy finds itself. Economic activities are never stagnant, with the result that a period of prosperity may be followed panicking or a pez'Lod of depression. Several economic indicators may indicate this sequence, for instance unemployment, declining output and profit margins, and the resulting loss of income on the national level. As soon as the lower turning point is reached, the economy starts to recover and a period of prosperity again follows. It can thus be argued that the business cycle is a result of interaction between demand and supply. The business cycle has a significant result on the economy as a whole. It influences the prosperity of the country and even that of the undertaking, its manpower position, its capacity occupation and its factors of production. Every individual is effected to the extend that his disposable income is directly determined by the position of the business cycle. The phases of the business cycle and the inclining and declining motion of economic data contains the nucleus of the effect of the external environment on the undertaking.

Thesis advisor: Peter Ireland / My dissertation consists of three papers on business cycles in developing countries. All the papers are different from each other and emphasize different aspects of understanding economic fluctuations in developing countries. The first paper is titled `Medium Term Business Cycles in Developing Countries' (with Diego Comin, Norman Loayza and Luis Serven). This paper models the link between business cycle fluctuations in developed countries with fluctuations in developing countries. Business cycle fluctuations in developed economies tend to have large and persistent effects on developing countries. We study the transmission of business cycle fluctuations from developed to developing economies with a two-country asymmetric DSGE model with two important features: (i) endogenous and slow diffusion of technologies from the developed to the developing country, and (ii) adjustment costs to investment flows. Consistent with the model, we observe that the flow of technologies from developed to developing economies co-moves positively with output in both developed and developing countries. After calibrating the model to Mexico and the U.S., it can explain the following stylized facts: (i) U.S. and Mexican output co-move more than consumption; (ii) U.S. shocks have a larger effect on Mexico than in the U.S.; (iii) U.S. business cycles lead over medium term fluctuations in Mexico; (iv) Mexican consumption is more volatile than output. The second paper of my dissertation is based on a price setting survey conducted by the State Bank of Pakistan (Central Bank). The paper is titled `Price-Setting Discoveries: Results from a Developing Country' (with M. Ali Choudhary, Abdul Faheem, Nadeem Hanif, and Saima Naeem) present the results of 1189 structured face-to-face interviews about price-setting behavior of the formal firms in the manufacturing and services sector of Pakistan. The key findings of the survey are:the frequency of price change is high in Pakistan, lowering the real impact of monetary policy. Price rigidity is mainly explained by firms caring about relative prices and the persistence of shocks. The exchange-rate and cost shocks are more important than financial and demand shocks for both setting prices and also the readiness with which these shocks pass-through to the economy. Formal sector firms with connections to the informal sector, especially through demand, have a lower probability of price adjustment. The lack of taxes and compliance with tax regime, i.e. enforcement are held responsible for existence of the informal sector by formal sector firms. The results from this paper provided motivation for the last paper of my dissertation about understanding and modeling the business cycle fluctuations in a developing economy like Pakistan. The last paper of my dissertation is titled `Modeling Business Cycles in Pakistan: A First Step'. In this paper, I establish the nature of short-run fluctuations of the Pakistani economy over the period of 1960-2010. There have been significant changes in the nature of the Pakistani economy over the last few decades. Therefore, I focus my detailed analysis on the last few decades where it seems more appropriate to investigate the nature and causes of business cycles in Pakistan. Furthermore, I evaluate the performance of a typical RBC and an augmented RBC model with an exogenous FDI shock in explaining cyclical fluctuations experienced by the Pakistani economy. I find that a simple RBC model does badly in terms of matching relevant second order moments of short run fluctuations as depicted by the data. However, augmented RBC model performs better compared to the simple RBC model. / Thesis (PhD) — Boston College, 2012. / Submitted to: Boston College. Graduate School of Arts and Sciences. / Discipline: Economics.

Thesis (Ph.D.)--Boston University / PLEASE NOTE: Boston University Libraries did not receive an Authorization To Manage form for this thesis or dissertation. It is therefore not openly accessible, though it may be available by request. If you are the author or principal advisor of this work and would like to request open access for it, please contact us at open-help@bu.edu. Thank you. / One of the lessons from the recent global financial crisis is the importance of macro-financial linkage in the economy. Based on this background, this dissertation analyzes the effects of financial frictions on the aggregate activities of the economy, wealth distribution and business cycles. The first chapter investigates the effects of financial development on aggregate capital accumulation and wealth distribution by constructing a heterogeneous-agent general equilibrium model with two idiosyncratic risks, endogenous occupational choice and Holmstrom and Tirole (1999) type financial contracts to prevent moral hazard issue. The benchmark model is calibrated to match the empirical data, where the wealth distribution has a right-hand fat tail and a small number of entrepreneurs hold a large amount of wealth. We find that financial development measured by decrease of monitoring cost contributes to the economy's higher capital accumulation and lower wealth Gini coefficient. The second chapter develops a dynamic stochastic general equilibrium (DSGE) model with financial frictions arising from the moral hazard problem as in Holmstrom and Tirole (1997) together with regulatory capital requirements on the banks. In contrast with the standard BGG (1999) financial accelerator model, we consider the agency problem from hidden action and regulatory capital requirements on the banks in order to examine whether changes of regulatory capital requirements result in credit crunches in the transmissions of aggregate technology and monetary policy shocks. The third chapter explores quantitative experiments using the above DSGE model. We examine whether there exists a "financial accelerator" effect from these kinds of financial frictions and a "credit crunch" from shocks. We find that there exists a "financial accelerator" effect and that financial deepening measured by decrease of financial intermediary's monitoring costs could contribute to mitigating business cycle fluctuations. In particular, no financial frictions with zero monitoring cost could decrease the variance of aggregate investment to around 18.5%. We also find that imposing and increasing capital requirements on the banks could cause decrease of bank's lending ("credit crunch"), thereby amplifying business cycles. / 2031-01-02

Research report presented to the Unisa School of Business Leadership / The results of the study show that as posited in the research statement, media spend is positive in relation to both the direct and indirect business cycles variables. This pattern of increased media spend is only maintained during the up-phases of the business cycle, but tends to level off during the down-phases.

Thesis. 1975. Ph.D.--Massachusetts Institute of Technology. Alfred P. Sloan School of Management. / Vita. / Bibliography: leaves 257-265. / Ph.D.

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Since the end of World War Two, the US unemployment rate has remained constant while the EU unemployment rate started to increase at the beginning of the 1970s. This increase in aggregate unemployment hides dramatic differences across skill groups: the increase has remained fairly small for high-skilled workers, while it is usually considerable for the least skilled workers. What caused these developments still remains a debated issue. A possible explanation is the size of the labor market institutions, much more developed on this side of the Atlantic. To study this question, we construct an intertemporal general equilibrium model. We start from the standard Real Business Cycle (RBC) model and we extend it by adding labor market frictions and institutions (minimum wage, employment protection and unemployment benefits). We also further develop the model along the skill dimension, by assuming that the population is composed of low- and high-skilled workers. The main conclusion is that rigid institutions, and especially rigid wages, may well play an important role, direct or indirect through the interactions with exogenous shocks, to explain the relative rise in the European unemployment rate, and especially the low-skilled unemployment rate. We also show that reductions in employer's contributions, targeted at the minimum wage, lead to a fall in the destruction of the less productive jobs and therefore strongly stimulate low-skilled employment, while increasing the welfare of all individuals.

Thesis (Ph. D.)--University of Texas at Austin, 2006. / Vita. Includes bibliographical references.