<p>Through careful methodological analysis, this book argues that modern macroeconomics has completely overlooked the aggregate nature of the data. In Part I, the authors test and reject the homogeneity assumption using disaggregate data. In Part II, they demonstrate that apart from random flukes, cointegration unidirectional Granger causality and restrictions on parameters do not survive aggregation when heterogeneity is introduced. They conclude that the claim that modern macroeconomics has solid microfoundations is unwarranted. However, some important theory-based models that do not fit aggregate data well in their representative-agent version can be reconciled with aggregate data by introducing heterogeneity.<br></p>

Aggregation and the Microfoundations of Dynamic Macroeconomics (The ASSET Series)

Business & Money

Forni, Mario

Lippi, Marco

Economics

Clarendon Press

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Books by Forni, Mario

See the best price to sell, buy, or rent books by Forni, Mario. BookScouter helps to compare book prices from 25+ online bookstores and 30+ buyback vendors with a single search.

Aggregation and the Microfoundations of Dynamic Macroeconomics (The ASSET Series)