Article thumbnail
Location of Repository

Making a match: Combining theory and evidence in policy-oriented macroeconomic modeling

By G Kapetanios, A. Pagan and A. Scott

Abstract

A persistent question in the development of models for macroeconomic policy analysis has been the relative role of economic theory and evidence in their construction. This paper looks at some popular strategies that involve setting up a theoretical or conceptual model (CM) which is transformed to match the data and then made operational for policy analysis. A dynamic general equilibrium model is constructed that is similar to standard CMs. After calibration to UK data it is used to examine the utility of formal econometric methods in assessing the match of the CM to the data and also to evaluate some standard model-building strategies. Keywords: Policy oriented economic modeling; Model evaluation; VAR model

Publisher: Elsevier
Year: 2007
DOI identifier: 10.1016/j.jeconom.2005.11.007
OAI identifier: oai:eprints.qut.edu.au:32937
Download PDF:
Sorry, we are unable to provide the full text but you may find it at the following location(s):
  • https://eprints.qut.edu.au/329... (external link)
  • Suggested articles


    To submit an update or takedown request for this paper, please submit an Update/Correction/Removal Request.