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The main objective of the model decides its size. In the current scenario there is an increasing interest in the use of these large-scale macroeonometric models for theory evaluation, impact analysis, policy simulation and forecasting purposes. [3] Large-scale macroeconometric models were criticized by Robert Lucas in his critique. Lucas argued ...
A macroeconomic model is an analytical tool designed to describe the operation of the problems of economy of a country or a region. These models are usually designed to examine the comparative statics and dynamics of aggregate quantities such as the total amount of goods and services produced, total income earned, the level of employment of productive resources, and the level of prices.
New trade theory (NTT) is a collection of economic models in international trade theory which focuses on the role of increasing returns to scale and network effects, which were originally developed in the late 1970s and early 1980s.
Disequilibrium macroeconomics is a tradition of research centered on the role of deviation from equilibrium in economics.This approach is also known as non-Walrasian theory, equilibrium with rationing, the non-market clearing approach, and non-tâtonnement theory. [1]
Dynamic stochastic general equilibrium modeling (abbreviated as DSGE, or DGE, or sometimes SDGE) is a macroeconomic method which is often employed by monetary and fiscal authorities for policy analysis, explaining historical time-series data, as well as future forecasting purposes. [1]
In contrast, non-equilibrium economics focuses on the dynamics of economic systems in states of flux, where imbalances, frictions, and external shocks can lead to persistent deviations from equilibrium or to multiple equilibria. This approach is used to study phenomena such as market crashes, economic crises, and the effects of policy ...
Hubbert's theory is used to predict when a resource will reach its peak of production by studying past resource discovery and production trends. Peak Oil advocates often show only crude oil production which may have set a global peak in 2005. Backstop resource theory maintains that alternatives will be developed as they are needed.
where the economic meanings of and are the equilibrium prices of various goods and the equilibrium activity levels of various economic agents, respectively. We can further extend the von Neumann general equilibrium model to the following structural equilibrium model with A {\displaystyle \mathbf {A} } and B {\displaystyle \mathbf {B} } as ...