Disaggregation in economic models

Charles Tiplitz

Naval Research Logistics Quarterly, 1984, vol. 31, issue 2, 213-228

Abstract: This article illustrates numerically that the adjustment path of the economy will not show how a national policymaker may be misled by overaggregation until it is too late for correction. Labor and other resources are overaggregated in the equilibrating mechanism of most economic models, tending to mislead policymakers regarding both the amount and direction of change of important variables. Overaggregation also hides important constraints and tradeoffs which masks opportunities to use slack resources. In turn, this creates unnecessary dilemmas, such as that between inflation and unemployment which plagued the progress of the Humphrey‐Hawkins Bill. The article first illustrates the hypothesis using simple models. Then its relevance to current analysis and planning is discussed.

Date: 1984
References: Add references at CitEc
Citations:

Downloads: (external link)
https://doi.org/10.1002/nav.3800310205

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:wly:navlog:v:31:y:1984:i:2:p:213-228

Access Statistics for this article

More articles in Naval Research Logistics Quarterly from John Wiley & Sons
Bibliographic data for series maintained by Wiley Content Delivery ().