This paper estimates several popular sticky-price New Keynesian models in an effort to understand whether and under what circumstances these models can usefully describe observed outcomes. We estimate and compare specifications that contain different forms of habit formation, specifications that...

This paper discusses twenty five methodological issues covering selected areas of both micro and macroeconomics. Included on the micro side are issues related to modelling the price system, assessing its efficiency, competing models of competition, modelling technological change and economic...

As the recession has deepened and the financial debacle has passed from one flare-up to another during the past seven or eight months, commentary on the economy’s troubles has swelled tremendously.

Keynes' principle of effective demand constitutes a pillar for Post Keynesians theories. But Keynes' presentation remains difficult to interpret, mainly because the aggregate demand function is based on entrepreneurs' expectations. The problem is then to demonstrate how these entrepreneurs...

Unemployment in Australia is now at its lowest in over 30 years. This experience of low rates of unemployment has prompted a number of statements that the Australian economy is at or very close to full employment. However, even though unemployment is low in comparison with the previous 30 years,...

In these timely essays, Nobel prize winning economist James Tobin shows how Keynesian economics offers corrective treatment for the economic ailments we have faced under the Ford, Carter, and Reagan administrations. Essays in the first part of the book focus on theory and policy in Keynesian...

These notes contain the derivations for results stated without proof in Hornstein (2007). First, I derive the log-linear approximation of the inflation dynamics in the Calvo-model with elements of backward-looking pricing when the approximation takes place around a positive average inflation...

Purpose – Unemployment is a systemic element of economic development which need not and “normally” does not give rise to full employment of labour regardless of the flexibility in labour markets. This paper aims to address these issues. Design/methodology/approach – The paper presents...

The paper investigates the relation between effective demand, income distribution and unemployment empirically. Its aim is to evaluate Keynesian, Kaldorian and neoclassical hypotheses about the determination of labor market variables. To do so, a vector autoregression model consisting of capital...

Keynesian concepts of probability and uncertainty emphasize the basis of knowledge available to economic decision makers. Conditions of uncertainty, which involve missing evidence or doubtful arguments, are distinguished from probable risk. Beyond this, on the basis of the claim that the future...