Equilibrium Growth, Inflation, and Bond Yields - Duke University's ...

a
" n
E[" z]
5.5
5
4.5
Figure 3: Expected Growth Rates
Technology Shock (! > 0)
4
0 5 10 15 20
0.4
0.3
0.2
0.1
0
−0.1
0 5 10 15 20
0.3
0.2
0.1
0
−0.1
0 5 10
quarters
15 20
E[" y]
E[" c]
E[" i]
0.6
0.4
0.2
0
Technology shock (!) > 0)
−0.2
0 5 10 15 20
0.3
0.2
0.1
0
−0.1
0 5 10 15 20
2
1
0
−1
0 5 10
quarters
15 20
This figure shows quarterly log-deviations from the steady state for the benchmark endogenous growth model ENDO
1 (solid line) and the exogenous growth model with a deterministic trend NCL 1 (dashed line) from a one standard
deviation shock to productivity. All deviations are in annualized percentage units.
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