The Macroeconomic Effects of Fiscal Policy: Linking an Econometric Model with Theory

Wren-Lewis, Simon, et al
Authors registered in the RePEc Author Service: Simon Wren-Lewis

Economic Journal, 1996, vol. 106, issue 436, 543-59

Abstract: In this paper, the authors outline a method, termed 'theoretical reconstruction,' which allows the system properties of any econometric macromodel to be related to a simpler theoretical model. First, elements of the econometric model which involve significant additional theoretical complexity compared to the theory model are removed. This process continues until the properties of the 'deconstructed' econometric model match those of the reference theory. Second, the econometric model is gradually reconstructed, noting at each point how each element of additional complexity influences the model properties. The technique is illustrated using fiscal policy changes and the U.K. econometric model COMPACT. Coauthors are Julia Darby, Jonathan Ireland, and Ottavio Ricchi. Copyright 1996 by Royal Economic Society.

Date: 1996
References: Add references at CitEc
Citations: View citations in EconPapers (9)

Downloads: (external link)
http://links.jstor.org/sici?sici=0013-0133%2819960 ... 0.CO%3B2-D&origin=bc full text (application/pdf)
Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ecj:econjl:v:106:y:1996:i:436:p:543-59

Ordering information: This journal article can be ordered from
http://www.blackwell ... al.asp?ref=0013-0133

Access Statistics for this article

Economic Journal is currently edited by Martin Cripps, Steve Machin, Woulter den Haan, Andrea Galeotti, Rachel Griffith and Frederic Vermeulen

More articles in Economic Journal from Royal Economic Society Contact information at EDIRC.
Bibliographic data for series maintained by Wiley-Blackwell Digital Licensing () and Christopher F. Baum ().