Galo Nuño
@NunoGalo
Director General, Institutional and European Relations @BancoDeEspana, Professor @CEMFInews, Fellow @cepr_org, @CESifoNetwork Views are my own.
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For ~40 years, we've assumed RBC models imply a tiny welfare cost of business cycles.
In a new paper w/ V. Carvalho & @matias_cova2 we show that it's an artifact of the single‑sector assumption.
Drop it, and the cost is ~100x larger.
A 🧵 (1/n, n= 12)
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