Posted

September 24, 2010 11:02:50 PM

Date

2010-03

Author

Carl E. Walsh

Affiliation

University of California, Santa Cruz

Title

Commentary: Using Models for Monetary Policy Analysis

Summary /
Abstract

Modern policy analysis makes extensive use of dynamic stochastic general equilibrium (DSGE) models. These models differ significantly from earlier generations of large-scale econometric models. I review what I see as major progress in the ability of economists to conduct model-based policy analysis. This progress has come through the evolution in the types of models being used and in a refinement of the types of questions asked of these models.

Keywords

JEL Codes: E17, E52

URL

http://www.ijcb.org/journal/ijcb10q1a13.pdf

Remarks

This is an excellent short commentary by an authority on theoretical and quantitative monetary policy on the evolution of macroeconometrics from the L. Klein days to the present DSGE era, highlighting the similarities and major differences and identifying the areas for improving DSGE modeling.

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