Identification Problems in SDGE Models with an illustration to a small Macro model

Andreas Beyer () and Roger Farmer

No 81, Computing in Economics and Finance 2006 from Society for Computational Economics

Abstract: We study identification in a class of linear rational expectations models. For any given exactly identified model, we provide an algorithm that generates a class of equivalent models that have the same reduced form. We use our algorithm to show that a model proposed by Jess Benhabib and Roger Farmer is observationally equivalent to the standard new-Keynesian model when observed over a single policy regime. However, the two models have different implications for the design of an optimal policy rule

Keywords: Identification; SDGE models (search for similar items in EconPapers)
JEL-codes: C39 C62 D51 (search for similar items in EconPapers)
Date: 2006-07-04
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Citations: View citations in EconPapers (4)

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Persistent link: https://EconPapers.repec.org/RePEc:sce:scecfa:81

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