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In this paper, we analyze the distribution of TFP growth rates at the four-digit sectoral level for the United States. We find that, contrary to the usual assumption employed in the literature on business cycles theory, technological shocks are not normally distributed. Instead, a Lévy-stable distribution with a divergent variance returns a better fit to the data.

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Address correspondence to: Edoardo Gaffeo, Department of Economics and CEEL, University of Trento, Via Inama 5, I-38100 Trento, Italy; e-mail:
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Macroeconomic Dynamics
  • ISSN: 1365-1005
  • EISSN: 1469-8056
  • URL: /core/journals/macroeconomic-dynamics
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