Building and using economic models: a case study analysis of the IS-LL model
AbstractThis paper critically assesses several model accounts written in the 1990s by epistemologists and philosophers of science by relating them to a specific but crucial example of model building, namely Hicks's (1937) construction of the first version of the IS-LM model, and examining in how far these accounts apply to this case. Thereby the paper contributes to answering why and how economists build models. The view crystallizes that economists build models not only to facilitate the conceptual exploration of theory, but also to inform our understanding of the world. Elements of model building, such as analogies, metaphors, stories, theoretical notions, empirical findings and mathematizations, but also the mode of representation shape the model and largely determine how much can be learned about theory and the real world by using the model as a tool.
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Bibliographic InfoPaper provided by Maastricht University in its series Open Access publications from Maastricht University with number urn:nbn:nl:ui:27-13674.
Date of creation: 2002
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Publication status: Published in Journal of economic methodology (2002) v.9, p.191-212
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Other versions of this item:
- Thomas Dohmen, 2001. "Building and using economic models: a case study analysis of the IS-LL model," Journal of Economic Methodology, Taylor and Francis Journals, vol. 9(2), pages 191-212.
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- McCloskey, Donald N, 1983. "The Rhetoric of Economics," Journal of Economic Literature, American Economic Association, vol. 21(2), pages 481-517, June.
- Warren Young & William Darity, Jr., 2004. "IS-LM-BP: An Inquest," History of Political Economy, Duke University Press, vol. 36(5), pages 127-164, Supplemen.
- Y Hsing, 2004. "Impacts of Dollar Depreciation and Low Deposit Rates on the US Economy," Economic Issues Journal Articles, Economic Issues, vol. 9(1), pages 1-14, March.
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