The Cowles Commission Approach, Real Business Cycle Theories, and New Keynesian Economics

24 Pages Posted: 6 Jul 2004

See all articles by Ray C. Fair

Ray C. Fair

Yale University - Cowles Foundation; Yale School of Management - International Center for Finance

Date Written: February 1992

Abstract

The Cowles Commission approach is reviewed and compared to the approaches of real business cycle (RBC) theorists and new Keynesian economists. It is argued that RBC models are not tested in a serious enough way and that the new Keynesian literature is not empirical enough for testing even to be a serious possibility. Macroeconomics seems to be moving away from its traditional empirical basis, which is sad. This paper argues for returning to the path that was abandoned by most macroeconomists around 1970, namely the specification and testing of structural macroeconometric models.

Suggested Citation

Fair, Ray C., The Cowles Commission Approach, Real Business Cycle Theories, and New Keynesian Economics (February 1992). NBER Working Paper No. w3990. Available at SSRN: https://ssrn.com/abstract=227999

Ray C. Fair (Contact Author)

Yale University - Cowles Foundation ( email )

Box 208281
New Haven, CT 06520-8281
United States
203-432-3715 (Phone)
203-432-6167 (Fax)

HOME PAGE: http://fairmodel.econ.yale.edu

Yale School of Management - International Center for Finance ( email )

Box 208200
New Haven, CT 06520
United States
203-432-3715 (Phone)
203-432-6167 (Fax)

HOME PAGE: http://fairmodel.econ.yale.edu

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
31
Abstract Views
765
PlumX Metrics