A REINTERPRETATION OF CHAPTER 17 OF KEYNES'S GENERAL THEORY: EFFECTIVE DEMAND SHORTAGE UNDER DYNAMIC OPTIMIZATION

Article Abstract:

This article is an attempt to formalize Chapter 17 of Keynes's General Theory using a continuous dynamic optimization model with perfect foresight. I present two subjective interest rates: the time preference rate and the liquidity premium that, respectively, govern the consumption-saving and portfolio decisions. Under optimal household behavior, they are equalized to the market rate of interest. In the monetary economy described by Keynes, however, the equality can be inconsistent with the condition of market equilibrium, in which case persistent stagnation occurs. A new analytic method based on dynamic optimization is proposed as an alternative to IS-LM analysis.

---

CROSS-SECTORAL PATTERNS OF EFFICIENCY AND TECHNICAL CHANGE IN MANUFACTURING

Article Abstract:

This article uses data from 11 countries for 19 years to investigate the forces driving output change in 6 manufacturing sectors. A flexible model is adopted that allows for the decomposition of output changes into three types of change: technical, efficiency, and input. This framework allows, among other things, for the investigation of (1) the relative roles of the three components of output growth in each sector, (2) the manner in which efficiency change moves over the business cycle, and (3) potential technical spillovers from one sector to another.

---

TESTING FOR AUTOCORRELATION USING A MODIFIED BOX-PIERCE Q TEST

Article Abstract:

This article investigates the finite-sample performance of a modified Box-Pierce Q statistic (Q*) for testing that financial time series are uncorrelated without assuming statistical independence. The finite-sample rejection probabilities of the Q* test under the null and its power are examined in experiments using time series generated by an MA (1) process where the errors are generated by a GARCH (1, 1) model and by a long memory stochastic volatility model. The tests are applied to daily currency returns.

Similar abstracts:

• Abstracts: MONOPOLY AND OLIGOPOLY PROVISION OF ADDICTIVE GOODS. STRATEGIC CERTIFICATION AND PROVISION OF QUALITY. FURTHER RESULTS ON BAYESIAN METHOD OF MOMENTS ANALYSIS OF THE MULTIPLE REGRESSION MODEL

This website is not affiliated with document authors or copyright owners. This page is provided for informational purposes only. Unintentional errors are possible.