Natural Concepts in Macroeconomics

42 Pages Posted: 22 Jun 2005

See all articles by Ray C. Fair

Ray C. Fair

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

Date Written: June 2005

Abstract

Ragnar Frisch proposed in 1936 a procedure for estimating natural variable values by modifying what are now called structural macroeconometric models. This paper shows that Frisch's procedure can be used to illuminate natural concepts using today's models. The procedure also forces one to be precise regarding the assumptions used in moving from a short-run model to a medium-run or long-run model.

Keywords: equilibrium, natural concepts

JEL Classification: E0

Suggested Citation

Fair, Ray C., Natural Concepts in Macroeconomics (June 2005). Cowles Foundation Discussion Paper No. 1525; Yale ICF Working Paper No. 05-21. Available at SSRN: https://ssrn.com/abstract=748086

Ray C. Fair (Contact Author)

Yale University - Cowles Foundation ( email )

Box 208281
New Haven, CT 06520-8281
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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

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