OECD Economics Department Working Papers
Working papers from the Economics Department of the OECD that cover the full range of the Department’s work including the economic situation, policy analysis and projections; fiscal policy, public expenditure and taxation; and structural issues including ageing, growth and productivity, migration, environment, human capital, housing, trade and investment, labour markets, regulatory reform, competition, health, and other issues.
The views expressed in these papers are those of the author(s) and do not necessarily reflect those of the OECD or of the governments of its member countries.
- ISSN: 18151973 (online)
- https://doi.org/10.1787/18151973
Economic Policies and Microeconomic Stability
A Literature Review and Some Empirics
The decline in macroeconomic volatility from the 1980s to the onset of the Great Recession did not, in general, translate into more microeconomic stability. While microeconomic volatility can reflect growth-generating processes, such as creative destruction and re-allocation of resources, consumption growth volatility weighs on households’ welfare. This study reviews the existing literature on the link between economic policies and economic stability at the firm and household level. Based on firm-level and household-level data for a wide range of OECD countries, it also provides preliminary results on sources and patterns of microeconomic volatility.
Keywords: volatility, economic policy, micro data, growth
JEL:
D12: Microeconomics / Household Behavior and Family Economics / Consumer Economics: Empirical Analysis;
O43: Economic Development, Innovation, Technological Change, and Growth / Economic Growth and Aggregate Productivity / Institutions and Growth;
E32: Macroeconomics and Monetary Economics / Prices, Business Fluctuations, and Cycles / Business Fluctuations; Cycles;
D22: Microeconomics / Production and Organizations / Firm Behavior: Empirical Analysis
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