What can civil society expect from academic macroeconomics?
Michel De Vroey ()
No 2013022, Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) from Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES)
Academic macroeconomics as it has been practiced for the last three decades has a bad reputation, especially after the onset of the 2008 recession. The aim of this paper is to reflect on this state of affairs. To begin, I draw a comparison between Keynesian and Lucasian macroeconomics, bringing to light that they are based on different tenets. Next, I claim that because of its higher internal consistency, Lucasian macroeconomics is superior to Keynesian. However, I also claim that espousing it bears a heavy price — in particular a limited usefulness for policymaking and an inability to come to grips with economic crises.
Keywords: Keynesian macroeconomics; Lucas; Real Business Cycle models (search for similar items in EconPapers)
JEL-codes: B E E (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-dge, nep-hpe and nep-mac
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Persistent link: http://EconPapers.repec.org/RePEc:ctl:louvir:2013022
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