Issues in Controllability and the Theory of Economic Policy

11 Pages Posted: 8 Jun 2004 Last revised: 4 Jan 2025

See all articles by Willem H. Buiter

Willem H. Buiter

Centre for Economic Policy Research (CEPR); CESifo (Center for Economic Studies and Ifo Institute); Columbia University; Independent Economic Adviser; Independent

Mark Gersovitz

Johns Hopkins University - Zanvyl Krieger School of Arts and Sciences; National Bureau of Economic Research (NBER)

Date Written: July 1981

Abstract

The paper demonstrates that the concepts of dynamic controllability are useful for the theory of economic policy by establishing four propositions. First dynamic controllability is a central concept in stabilization policy. Second, the ability to achieve a target state, even if it cannot be maintained. may be of economic interest. Third, dynamic controllability is of special interest for 'historical' models. Fourth, the conditions for any notion of dynamic controllability are distinct from and weaker than those for Tinbergen static controllability.

Suggested Citation

Buiter, Willem H. and Gersovitz, Mark, Issues in Controllability and the Theory of Economic Policy (July 1981). NBER Working Paper No. t0002, Available at SSRN: https://ssrn.com/abstract=412367

Willem H. Buiter (Contact Author)

Centre for Economic Policy Research (CEPR)

London
United Kingdom

CESifo (Center for Economic Studies and Ifo Institute)

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Munich, DE-81679
Germany

HOME PAGE: http://www.CESifo.de

Columbia University ( email )

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Independent Economic Adviser ( email )

Independent ( email )

Mark Gersovitz

Johns Hopkins University - Zanvyl Krieger School of Arts and Sciences ( email )

Department of Economics
Baltimore, MD 21218
United States

National Bureau of Economic Research (NBER)

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United States

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