Aggregation and the Microfoundations of Dynamic Macroeconomics (The ASSET Series) - Hardcover

Forni, Mario; Lippi, Marco

 
9780198288008: Aggregation and the Microfoundations of Dynamic Macroeconomics (The ASSET Series)
Hardcover
ISBN 10: 019828800X ISBN 13: 9780198288008
Publisher: Clarendon Press, 1998

Synopsis

Through careful methodological analysis, this book argues that modern macroeconomics has completely overlooked the aggregate nature of the data. In Part I, the authors test and reject the homogeneity assumption using disaggregate data. In Part II, they demonstrate that apart from random flukes, cointegration unidirectional Granger causality and restrictions on parameters do not survive aggregation when heterogeneity is introduced. They conclude that the claim that modern macroeconomics has solid microfoundations is unwarranted. However, some important theory-based models that do not fit aggregate data well in their representative-agent version can be reconciled with aggregate data by introducing heterogeneity.

"synopsis" may belong to another edition of this title.

About the Author

Mario Forni is at University of Modena. Marco Lippi is at Universita di Roma "La Sapienza".

"About this title" may belong to another edition of this title.

Publisher
Clarendon Press
Publication date
1998
Language
English
ISBN 10 
019828800X
ISBN 13 
9780198288008
Binding
Hardcover
Edition number
1
Number of pages
254