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Palgrave Macmillan

An Econometric Model of the US Economy

Structural Analysis in 56 Equations

  • Book
  • © 2017

Overview

Authors:
  1. John J. Heim

    1. University at Albany-SUNY , Albany, USA

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  • Connects behavioral equations into a comprehensive model of the real US economy
  • Includes comprehensive comparisons of results from older Cowles model and newer VAR and DSGE models
  • Features 75 variables
  • Features findings confirmed by retesting in different time periods and models

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Table of contents (20 chapters)

  1. Front Matter

    Pages i-xxx
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  2. Introduction

    • John J. Heim
    Pages 1-36

  3. Production of the GDP

    1. Front Matter

      Pages 37-37
      Download chapter PDF

    2. Methodology

      • John J. Heim
      Pages 39-114

    3. Literature Review

      • John J. Heim
      Pages 115-146

    4. The Consumption Models

      • John J. Heim
      Pages 147-184

    5. Models Identifying the Determinants Of Investment Spending And Borrowing

      • John J. Heim
      Pages 185-219

    6. The Exports Demand Equation

      • John J. Heim
      Pages 221-228

    7. Statistically Estimated Real GDP Determination Functions (“IS” Curves)

      • John J. Heim
      Pages 229-238

    8. Real GDP Determination Function ( “IS” Curve) Coefficients Aggregated from Parameter Estimates Obtained By Statistically Estimating The Subcomponent Functions Comprising The GDP

      • John J. Heim
      Pages 239-252

    9. Methodology

      • John J. Heim
      Pages 253-258

    10. Determinants Of The Prime Interest Rate – LM Curve Method

      • John J. Heim
      Pages 259-263

    11. Determinants of Inflation - The Phillips Curve Model

      • John J. Heim
      Pages 265-271

    12. Determinants of Unemployment

      • John J. Heim
      Pages 273-283

    13. The Savings Functions

      • John J. Heim
      Pages 285-302

    14. Determinants of Government Receipts

      • John J. Heim
      Pages 303-308

    15. Endogeneity of Government Spending Levels

      • John J. Heim
      Pages 309-316

    16. Capacity Of The Model To Explain Behavior Of The Macroeconomy Beyond The Period Used To Estimate The Model

      • John J. Heim
      Pages 317-330

    17. Converting the Older Keynesian IS-LM Model To The More Modern AS-AD Interpretation Of The Keynesian Model

      • John J. Heim
      Pages 331-362

    18. Dynamics

      • John J. Heim
      Pages 363-371
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Keywords

About this book

This book explores the US economy from 1960 to 2010 using a more Keynsian, Cowles model approach, which the author argues has substantial advantages over the vector autoregression (VAR) and dynamic stochastic general equilibrium (DSGE) models used almost exclusively today. Heim presents a robust argument in favor of the Cowles model as an answer to the pressing, unresolved methodological question of how to accurately model the macroeconomy so that policymakers can reliably use these models to assist their decision making. Thirty-eight behavioral equations, describing determinants of variables such as consumption, taxes, and government spending, are connected by eighteen identities to construct a comprehensive model of the real US economy that Heim then tests across four different time periods to ensure that results are consistent. This comprehensive demonstration of the value of a long-ignored model provides overwhelming evidence that the more Keynesian (Cowles) structural models outperform VAR and DSGE, and therefore should be the models of choice in future macroeconomic studies.     


Authors and Affiliations

  • University at Albany-SUNY , Albany, USA

    John J. Heim

About the author

John J. Heim is Visiting Professor at University of Albany-SUNY, and retired Clinical Professor of Economics at Rensselaer Polytechnic Institute, both in New York, USA.

Bibliographic Information

  • Book Title: An Econometric Model of the US Economy

  • Book Subtitle: Structural Analysis in 56 Equations

  • Authors: John J. Heim

  • DOI: https://doi.org/10.1007/978-3-319-50681-4

  • Publisher: Palgrave Macmillan Cham

  • eBook Packages: Economics and Finance, Economics and Finance (R0)

  • Copyright Information: The Editor(s) (if applicable) and The Author(s) 2017

  • Hardcover ISBN: 978-3-319-50680-7Published: 21 December 2017

  • Softcover ISBN: 978-3-319-84460-2Published: 30 August 2018

  • eBook ISBN: 978-3-319-50681-4Published: 06 December 2017

  • Edition Number: 1

  • Number of Pages: XXX, 460

  • Number of Illustrations: 14 b/w illustrations

  • Topics: Econometrics, Macroeconomics/Monetary Economics//Financial Economics, Regional/Spatial Science

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