Topics in Applied Macrodynamic Theory / Edition 1

by Peter Flaschel, Gangolf Groh, Christian Proano, Willi Semmler

Overview

This book is about the study of topics in macro dynamics from an applied, empirical perspective. The modeling philosophy behind most of the chapters ofthisbookisofKeynesiannature,representinganattempttorevivethist- oreticalperspectiveontheworkingof themacroeconomy. Themacroeconomic research pursued here is somewhat different from the mainstream literature using the Dynamic Shastic General Equilibrium (DSGE) approach as the basic modeling device. The main features of the latter are the assumptions of intertemporally optimizing agents, rational expectations, competitive markets and price mediated market clearing through sufficiently—exible prices and wages. The New Keynesian approach to macroeconomics has, in the last decade or so, to a large extent, also adopted the DSGE framework, building on intertemporally optimizing agents and market clearing, but favoring more the concept of monopolistic competition, sticky wages and prices and nominal as well as real rigidities. An path breaking work of this type is the recent book by Woodford (2003). However, it is well known that the intertemporal approach of smoothly optimizing agents and fast adjustments in order to establish temporal or - tertemporal marginal conditions in the product market, labor and capital markets, has not been very successful to match certain stylized facts on those markets. A further defficiency of those intertemporal decision models is that macroeconomic feedback effects—and their stabilizing or destabilizing impact on the macroeconomy—have rarely been considered in those models. Yet, those feedback mechanisms, relevant for the interaction of all three markets, have been theoretically and empirically explored since the 1930s.

Product Details

ISBN-13:	9783540725411
Publisher:	Springer Berlin Heidelberg
Publication date:	09/25/2008
Series:	Dynamic Modeling and Econometrics in Economics and Finance , #10
Edition description:	2008
Pages:	512
Product dimensions:	6.30(w) x 9.40(h) x 1.30(d)

Table of Contents

Period Models, Continuous Time and Applied Macrodynamics.- Period Models, Continuous Time and Applied Macrodynamics.- The Closed Economy.- The AS–AD Framework: Origins, Problems and Progress.- Wage–Price Dynamics: Basic Structural Form, Estimation and Analysis.- Estimation and Analysis of an Extended AD–AS Model.- Linking Goods with Labor Markets: Okun’s Law and Beyond.- The Open Economy.- Exchange Rate and Sk Market Dynamics in a Two-Country Model.- Macroeconomic Imbalances and Inflation Dynamics in a Mundell-Fleming-Tobin Framework.- Currency Crises, Credit Rationing and Monetary Policy in Emerging Markets.- Keynesian Dynamics and International Linkages in a Two-Country Model.- Outlook: Supply Constraints in Demand-Driven Macromodels.