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Causal Relations via Econometrics

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  • Zaman, Asad

Abstract

Applied econometric work takes a superficial approach to causality. Understanding economic affairs, making good policy decisions, and progress in the economic discipline depend on our ability to infer causal relations from data. We review the dominant approaches to causality in econometrics, and suggest why they fail to give good results. We feel the problem cannot be solved by traditional tools, and requires some out-of-the-box thinking. Potentially promising approaches to solutions are discussed.

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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 10128.

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Date of creation: 31 May 2008
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Handle: RePEc:pra:mprapa:10128

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Keywords: causality; regression; Granger Causality; Exogeneity; Cowles Commission; Hendry Methodology; Natural Experiments;

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Cited by:
  1. Zaman, Asad, 2012. "Methodological mistakes and econometric consequences," MPRA Paper 41032, University Library of Munich, Germany.
  2. Zahid Asghar, 2011. "A Structural Approach for Testing Causality," International Econometric Review (IER), Econometric Research Association, vol. 3(2), pages 1-12, September.
  3. Gnidchenko, Andrey, 2011. "Моделирование Технологических И Институциональных Эффектов В Макроэкономическом Прогнозировании
    [Technologica
    ," MPRA Paper 35484, University Library of Munich, Germany, revised May 2011.

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