King et al. ([King, Robert G., 1991]) evaluate the empirical relevance of a class of real business cycle models with permanent productivity shocks by analyzing the stochastic trend properties of postwar U.S. macroeconomic data. They find a common stochastic trend in a three‐variable system...

This paper tests Mankiw’s (1987) revenue-smoothing hypothesis, that the inflation rate moves one-for-one with the marginal tax rate in the long run, using the new average marginal tax rate series constructed by Stephenson (1998) and the long-horizon regression approach developed by Fisher and...

The current mainstream approach to monetary policy is based on the New Keynesian model and is expressed in terms of a short-term nominal interest, such as the federal funds rate in the United States. It ignores the role of leverage and also downplays the role of money in basic monetary theory...

This study contrasts the (apparent) random walk behaviour of the real exchange rate to chaotic dynamics, using (US) dollar-based real exchange rates for 17 OECD countries (covering the period 1957:1-1995:4). Tests for deterministic noisy chaos are carried out using the Nychka, Ellner, Gallant...