I characterize cyclical fluctuations in the cross-sectional dispersion of firm-Level productivity. Using the micro-estimated dispersion, or "risk," stochastic process as an input to a baseline small-scale nancial accelerator model, I assess how well...

We study the role of agency frictions and costly external finance in cyclical labor market dynamics, with a focus on how credit-market frictions may amplify aggregate TFP shocks. The main result is that aggregate TFP shocks lead to large fluctuations...