A Short History of Macro-econometric Modelling
David Hendry ()
No 2020-W01, Economics Papers from Economics Group, Nuffield College, University of Oxford
The key stages in the development of empirical macro-econometric model building are briefly described. Essential steps included characterizing the economy as a system, collating aggregate macroeconomic time series on prices and quantities, isolating the many interacting concepts necessary for understanding how to empirically model economies, inventing viable methods of estimation and inference for dynamic systems, developing hardware and software calculating devices to make such approaches operational, then combining all of these to implement empirical macro-econometric modelling, forecasting and policy making. Its history is littered with both successes and failures, leading overall to substantive progress in understanding, but highlighting the roles of fashions in economic theory dominating empirical evidence and the pernicious impacts of location shifts causing forecast failures and entailing theory failures.
Keywords: History of Macroeconomic Modelling; Macro-econometric models; National Accounts; Forecasting, Economic policy (search for similar items in EconPapers)
JEL-codes: B22 B23 (search for similar items in EconPapers)
Pages: 29 pages
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Persistent link: https://EconPapers.repec.org/RePEc:nuf:econwp:2001
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