Eugene Fama's influential argument that the price level and real allocations are independent of the volume and composition of private financial portfolios, including bank deposits, is examined. An incomplete analysis of the role of financial assets leads to a failure to distinguish between real...

Causal relations between US federal taxation and expenditure are analyzed using an approach based on the invariance of econometric relationships in the face of structural interventions. Institutional evidence for interventions or changes of regime and econometric tests for structural breaks are...

Advocates of real-business-cycle models typically hold calibration methods to be superior to econometric estimation as means of quantifying the models for policy analysis. This paper finds a coherent foundation for calibration methods in Herbert Simon's Sciences of the Artificial and the...