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Why Does No One Teach Undergraduate Macroeconomics Using the Dyanmic Stochastic General Equilibrium Model?

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  • Paul Turner

Abstract

This paper argues that the reason that the DSGE model, which has proved so successful in convincing academic economists of its value, has made relatively few inroads into the undergraduate teaching sphere is that it fails to allow for the development of higher order educational objectives in students. The qualities which make it attractive to academics, such as the purity of its assumptions and its sound microeconomic basis, have little resonance with undergraduate students. Instead, the qualities of the neo-Keynesian model, such as its ability to incorporate 'real-world' institutional features and the ease with which it can be used to develop higher order skills and applications, prove much more attractive.

Suggested Citation

  • Paul Turner, 2010. "Why Does No One Teach Undergraduate Macroeconomics Using the Dyanmic Stochastic General Equilibrium Model?," Journal for Economic Educators, Middle Tennessee State University, Business and Economic Research Center, vol. 10(2), pages 7-15, Fall.
    • Handle: RePEc:mts:jrnlee:v:10:y:2010:i:2:p:7-15
    as

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    File URL: http://frank.mtsu.edu/~jee/2010/fall/2pp7to15_MS510.pdf
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    References listed on IDEAS

    as
    1. Olivier Jean Blanchard & Stanley Fischer, 1989. "Lectures on Macroeconomics," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262022834, December.
    2. Lucas, Robert Jr, 1976. "Econometric policy evaluation: A critique," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 1(1), pages 19-46, January.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    macroeconomics; DSGE models; pedagogical approaches;
    All these keywords.

    JEL classification:

    • A22 - General Economics and Teaching - - Economic Education and Teaching of Economics - - - Undergraduate
    • E20 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - General (includes Measurement and Data)

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