Natural Concepts in Macroeconomics
42 Pages Posted: 22 Jun 2005
Date Written: June 2005
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: Suggested Citation