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Hysteresis is referred to the hypothesis that recessions may have permanent effects on the level of output relative to trend.
DSGE is a methodology for a wide range of macroeconomics models. One of the most common formulations is the so-called New Keynesian model. New Keynesian economics can be interpreted as an effort to combine the methodological tools developed by real business cycle theory with some of the central tenets of Keynesian economics tracing back to Keynes’ own General Theory.
>Professor Olivier Blanchard further explained the role empirical research on DSGE models, how to teach undergraduates macro after the Great Recession, and his research on hysteresis.
In this interview, Blanchard discussed his view on the role of DSGE model in modern Macroeconomics and policymaking. He also explained his decision to rewrite his macroeconomics textbooks after the Great Recession. His recent research on hysteresis was also discussed.
Olivier Blanchard a list of things that macroeconomists normally agreed on and need no further discussions.
The discussion on Paul Romer's "The Trouble with Macroeconomics" continues in the blogosphere, and Simon Wren -Lewis's "Paul Romer on macroeconomics" is one of...
In his latest Brookings blog post "Modifying the Fed’s policy framework: Does a higher inflation target beat negative interest rates?", Ben Bernanke compares two...
John Cochrane talks about Fiscal Theory of Price Level and how can we apply this theory on the current macroeconomy.
The Fiscal Theory of the Price Level says that money has value because the government accepts it for taxes, and inflation is fundamentally a fiscal phenomenon
Cochrane discusses with us his view on the development in Macroeconomics since the Great Depression. He also explains what Neo-Fisherian and Fiscal Theory of Price Level are, and why they are important for understanding the current economic situation around the world.