REAL BUSINESS CYCLE THEORY, TECHNOLOGICAL SHOCKS AND THEIR ANALYSIS

Abstract

This study examines the theoretical foundations of Real Business Cycle (RBC) theory and analyzes the role of technological shocks in explaining macroeconomic fluctuations. The research is based on a dynamic stochastic general equilibrium (DSGE) framework, where economic cycles are interpreted as optimal responses of rational agents to changes in productivity. The study evaluates how technological shocks affect key macroeconomic variables such as output, labor supply, investment, and consumption. The findings indicate that RBC theory successfully explains several stylized facts of business cycles, including procyclical behavior and investment volatility. However, the study also highlights limitations related to the absence of market imperfections and demand-side factors. The results suggest that RBC theory should be complemented with other macroeconomic approaches for a more comprehensive analysis.