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  3. Journal of Economic Perspectives
  4. Summer 1989
  5. Understanding Real Business Cycles

Understanding Real Business Cycles

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Abstract

This brief essay is intended to provide readers with an introduction to the real business cycle approach to business fluctuations. It discusses the basic real business cycle framework; economic growth and business cycles; real business cycles and the 1954-1985 U.S. economy; government policies and suboptimal equilibrium; and the real business cycle research agenda. An appendix presents a more technical summary of the basic neoclassical model presented in the paper.

Citation

Plosser, Charles I. 1989. "Understanding Real Business Cycles." Journal of Economic Perspectives, 3 (3): 51-77. DOI: 10.1257/jep.3.3.51

JEL Classification

  • 131 Economic Fluctuations--Theory
  • 131 Economic Fluctuations--Studies
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