From real business cycle and new Keynesian to DSGE Macroeconomics: facts and models in the emergence of a consensus

Pedro Duarte

No 2015_05, Working Papers, Department of Economics from University of São Paulo (FEA-USP)

Abstract: Macroeconomists have emphasized the force of facts in forging a consensus understanding of business cycle fluctuations. According to this view, rival economists could no longer hold disparate views on the topic because “facts have a way of not going away” (Blanchard 2009). But how can macroeconomists observe the workings of an economy? Essentially through building and manipulating models. Thus the construction of macroeconomic facts –or “stylized facts”–, empirical regularities that come to be widely accepted, opens up technical spaces where macroeconomists negotiated their theoretical commitments and eventually allowed a consensus to emerge. I argue that this is an important element in the history of the DSGE macroeconomics.

Keywords: DSGE models; history of macroeconomics; new Keynesian macroeconomics; real business cycles (search for similar items in EconPapers)
JEL-codes: B22 B23 E32 (search for similar items in EconPapers)
Date: 2015-04-17
New Economics Papers: this item is included in nep-dge, nep-his, nep-hpe and nep-mac
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Citations: View citations in EconPapers (11)

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Working Paper: FROM REAL BUSINESS CYCLE AND NEW KEYNESIAN TO DSGE MACROECONOMICS: FACTS AND MODELS IN THE EMERGENCE OF A CONSENSUS (2016)
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