Essays on business cycles and macroeconomic policies

Pham, Nguyen Quoc Anh (2023). Essays on business cycles and macroeconomic policies. University of Birmingham. Ph.D.

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Abstract

It is critical to investigate the behaviour and the impact of shocks during crises to comprehend their persistence and how they affect the economy. Furthermore, studying macroeconomic policies is critical as it helps answer the issues of whether the economy and society are better off with the implemented policies, and how the application of these policies may truly mitigate the effects of unfavourable shocks.

Consequently, this thesis focuses on using the Dynamic Stochastic General Equilibrium (DSGE) models to examine the effects of exogenous shocks on the business cycles as well as the effectiveness of government-implemented macroeconomic policies.

The framework of this thesis is outlined in chapter one, as well as a brief summary of each chapter’s primary concepts, results, and contributions.

In chapter 2, we use a DSGE model with heterogeneous agents and other common features of medium-scale DSGE models, such as consumption habit formation, adjustment costs, and variable capacity utilisation, to answer the question of whether active or passive fiscal policies are more effective in a closed economy.

Chapter 3 uses Bayesian approaches together with the DSGE model for a small open economy to estimate the impact of pandemic shocks on the UK economy. We also discover how these shocks are transmitted to other economic variables. To simulate the UK government’s reaction during the epidemic, we integrate the extensive margins of labour supply and the lockdown policy shock.

The fourth chapter estimates the spillover effects of US shocks on the Vietnamese economy using a DSGE model with two-country blocs. In addition, we modify the model to include a commodity sector to analyse the impact of the oil price shock.

Finally, the last chapter summarises the main findings and explores their implications for macroeconomic policy planning. Furthermore, this chapter offers some directions for future research from this thesis.

Type of Work:

Thesis (Doctorates > Ph.D.)

Award Type:

Doctorates > Ph.D.

Supervisor(s):