@misc{10038,
title = {Policy Volatility and Growth},
author = {Gradstein, Mark and Chong, Alberto E.},
year = {2011},
doi = {10.18235/0010868},
abstract = {A growing body of recent macroeconomic evidence suggests that volatility is detrimental to economic growth. The channels through which volatility affects growth, however, are less clear; substantive evidence based on disaggregate data is almost non-existent. This paper offers a framework in which policy volatility has an adverse effect on firms' entry into productive industries, thereby affecting economic growth. Empirical support for this relationship is based on a detailed dataset of thousands of firms from some 80 countries. Additional evidence is provided on the channels through which volatility affects firm growth, showing that institutional obstacles magnify the effect.},
url = {https://doi.org/10.18235/0010868}
}