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Behavioral economics and macroeconomic models

Driscoll, John C.; Holden, Steinar - 2014 - This version: 7 April 2014

Over the past 20 years, macroeconomists have incorporated more and more results from behavioral economics into their models. We argue that doing so has helped fixed deficiencies with standard approaches to modeling the economy-for example, the counterfactual absence of inertia in the standard...

Persistent link: https://www.econbiz.de/10010350486

Searching for Keynes : an essay on the political economy of fiscal policy, with application to Canada, 1870-2000 - revised version

Winer, Stanley L.; Ferris, John Stephen - 2003

Keynes' General Theory (1936) is arguably one of the most important books of the twentieth century. His ideas for … stabilizing the aggregate economy have profoundly influenced economic theory as well as popular opinion about what governments can … and should do with respect to the business cycle. On the other hand, whether Keynesian theory has substantially altered …

Persistent link: https://www.econbiz.de/10011509394

Liquidity traps and large-scale financial crises

Caggiano, Giovanni; Castelnuovo, Efrem; Damette, Olivier; … - 2018

This paper estimates a nonlinear Threshold-VAR to investigate if a Keynesian liquidity trap due to a speculative motive was in place in the U.S. Great Depression and the recent Great Recession. We find clear evidence in favor of a breakdown of the liquidity effect after an unexpected increase in...

Persistent link: https://www.econbiz.de/10011863616

Have macroeconomic models lost their connection with economic reality?

Veen, Tom van - 2020

Macroeconomic theory has developed into increasingly sophisticated mathematical models. In the words of Mankiw … the development of macroeconomic theory over the past 40 years. The focus is on the main lines of thinking and the story … changes in macroeconomic theory and that the current debates after the GFC will be the start of a more plural approach to …

Persistent link: https://www.econbiz.de/10012211109

Reasons for the demise of interest : savings glut and secular stagnation or central bank policy?

Mayer, Thomas; Schnabl, Gunther - 2019

, from the perspective of Austrian business cycle theory, interest rates were step by step decreased by central banks to … nihilo and the need of time to produce capital invalidates the IS identity assumed in the Keynesian theory to hold …

Persistent link: https://www.econbiz.de/10012124862

Back to Keynes?

Ploeg, Frederick van der (contributor) - 2005

After a brief review of classical, Keynesian, New Classical and New Keynesian theories of macroeconomic policy, we assess whether New Keynesian Economics captures the quintessential features stressed by J.M. Keynes. Particular attention is paid to Keynesian features omitted in New Keynesian...