Publish and Perish: Creative Destruction and Macroeconomic Theory

Post-print, published in History of Economic Ideas (2018), 26(2), pp.65-101.

29 Pages Posted: 15 Feb 2017 Last revised: 9 Mar 2019

See all articles by Jean-Bernard Chatelain

Jean-Bernard Chatelain

Paris School of Economics, Université Paris 1 Panthéon Sorbonne

Kirsten Ralf

Ecole Supérieure du Commerce Extérieur (ESCE)

Date Written: December 20, 2017

Abstract

A number of macroeconomic theories, very popular in the 1980s, seem to have completely disappeared and been replaced by the dynamic stochastic general equilibrium (DSGE) approach. We will argue that this replacement is due to a tacit agreement on a number of assumptions, previously seen as mutually exclusive, and not due to a settlement by "nature". As opposed to econometrics and microeconomics and despite massive progress in the access to data and the use of statistical softwares, macroeconomic theory appears not to be a cumulative science so far. Observational equivalence of different models and the problem of identification of parameters of the models persist as will be highlighted by examining two examples: one in growth theory and a second in testing inflation persistence.

Keywords: Macroeconomic theory, controversies, identification, economic growth, convergence, inflation persistence

JEL Classification: B22, B23, B41, C52, E31, O41, O47

Suggested Citation

Chatelain, Jean-Bernard and Ralf, Kirsten, Publish and Perish: Creative Destruction and Macroeconomic Theory (December 20, 2017). Post-print, published in History of Economic Ideas (2018), 26(2), pp.65-101., Available at SSRN: https://ssrn.com/abstract=2915860 or http://dx.doi.org/10.2139/ssrn.2915860

Jean-Bernard Chatelain (Contact Author)

Paris School of Economics, Université Paris 1 Panthéon Sorbonne ( email )

48 Boulevard Jourdan
Paris, 75014 75014
France

HOME PAGE: http://www.parisschoolofeconomics.eu/fr/chatelain-jean-bernard/

Kirsten Ralf

Ecole Supérieure du Commerce Extérieur (ESCE) ( email )

10 Rue Sextius Michel
Paris, 75015
France

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