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Implications of Heterogeneity in Preferences, Beliefs and Asset Trading Technologies for the Macroeconomy
Chien, YiLi - 2014
technologies and are subject to both aggregate and idiosyncratic income risk. The different asset trading technologies, which are …
Persistent link: https://www.econbiz.de/10013050169
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The Equity Premium and the Concentration of Aggregate Shocks
Mankiw, N. Gregory - 2021
depends on the concentration of these aggregate shocks; it follows that one cannot estimate the degree of risk aversion from …
Persistent link: https://www.econbiz.de/10013227010
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The Use and Misuse of Models for Climate Policy
Pindyck, Robert S. - 2015
In recent articles, I have argued that integrated assessment models (IAMs) have flaws that make them close to useless as tools for policy analysis. IAM-based analyses of climate policy create a perception of knowledge and precision that is illusory, and can fool policy-makers into thinking that...
Persistent link: https://www.econbiz.de/10013024159
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The Perils of the Learning Model for Modeling Endogenous Technological Change
Nordhaus, William D. - 2010
Learning or experience curves are widely used to estimate cost functions in manufacturing modeling. They have recently been introduced in policy models of energy and global warming economics to make the process of technological change endogenous. It is not widely appreciated that this is a...
Persistent link: https://www.econbiz.de/10012758017
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New Keynesian Models : Not Yet Useful for Policy Analysis
Chari, Varadarajan V. - 2010
Macroeconomists have largely converged on method, model design, reduced-form shocks, and principles of policy advice. Our main disagreements today are about implementing the methodology. Some think New Keynesian models are ready to be used for quarter-to-quarter quantitative policy advice; we do...
Persistent link: https://www.econbiz.de/10012758420
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Why You Should Never Use the Hodrick-Prescott Filter
Hamilton, James D. - 2017
Here's why. (1) The HP filter produces series with spurious dynamic relations that have no basis in the underlying data-generating process. (2) Filtered values at the end of the sample are very different from those in the middle, and are also characterized by spurious dynamics. (3) A statistical...
Persistent link: https://www.econbiz.de/10012955932
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How Structural are Structural Parameters?
Fernández-Villaverde, Jesús - 2012
This paper studies how stable over time are the so-called "structural parameters" of dynamic stochastic general equilibrium (DSGE) models. To answer this question, we estimate a medium-scale DSGE model with real and nominal rigidities using U.S. data. In our model, we allow for parameter...
Persistent link: https://www.econbiz.de/10013104685
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The Fallacy of the Fiscal Theory of the Price Level
Buiter, Willem H. - 2021
or unsound argument'. The 'fiscal theory of the price level', recently re-developed by Woodford, Cochrane, Sims and … proponents of the fiscal theory of the price level do not accept the fundamental proposition that the government's intertemporal …. Policy conclusions could be drawn from the fiscal theory of the price level that would be harmful if they influenced the …
Persistent link: https://www.econbiz.de/10013223568
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Keynesian Macroeconomics Without the Lm Curve
Romer, David H. - 2021
Changes in both the macroeconomy and in macroeconomics suggest that the IS-LM-AS model is no longer the best baseline model of short-run fluctuations for teaching and policy analysis. This paper presents an alternative model that replaces the assumption that the central bank targets the money...
Persistent link: https://www.econbiz.de/10013226979
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The Public Critique of Welfare Economics : an Exploration
Besley, Timothy J.; Coate, Stephen - 2021
The welfare economic method for analyzing the case for government intervention is often criticized for ignoring the political determination of policies. While many economists accept the thrust of this critique, exactly when and how political determination interferes with a welfare economic...
Persistent link: https://www.econbiz.de/10013228975