Modern Macroeconomics in Practice: How Theory is Shaping Policy

By V. V. Chari, V. V. Chari, Patrick J. Kehoe. 2006

146 citations recorded by the source corpus.

Theoretical advances in macroeconomics made in the last three decades have had a major influence on macroeconomic policy analysis. Moreover, over the last several decades, the United States and other countries have undertaken a variety of policy changes that are precisely what macroeconomic theory of the last 30 years suggests. The three key developments that have shaped macroeconomic policy analysis are the Lucas critique of policy evaluation due to Robert Lucas, the time inconsistency critique of discre-tionary policy due to Finn Kydland and Edward Prescott, and the development of quantitative dynamic stochastic general equilibrium models following Finn Kydland and Edward Prescott.

Subfields: Economics and Econometrics

View Paper: https://www.semanticscholar.org/paper/f64c7b4f17a290ba236561f86e89fd2bbd1cf896

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In Economics and Econometrics

Citations in the corpus

Seeing Like the Fed: Culture, Cognition, and Framing in the Failure to Anticipate the Financial Crisis of 2008 (2017, background): “Academics and Fed economists writing in the 2000s took for granted that such principles directly informed the FOMC’s efforts to analyze the economy and make monetary policy (Chari and Kehoe 2006; Goodfriend 2007).”