all basic assumptions underlying the theory model should be formulated as a set of testable hypotheses on the long …-run structure of a CVAR model, a so called 'theory consistent hypothetical scenario'. The advantage of such a scenario is that it … forces us to formulate all testable implications of the basic hypotheses underlying a theory model. We demonstrate that most …

all basic assumptions underlying the theory model should be formulated as a set of testable hypotheses on the long …-run structure of a CVAR model, a so called 'theory consistent hypothetical scenario'. The advantage of such a scenario is that if … forces us to formulate all testable implications of the basic hypotheses underlying a theory model. We demonstrate that most …

volatility in the disturbances. The risk of a liquidity trap in the U.S.A. and Japan is evaluated. Although this risk found to be …