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The Financial Crisis: What have macroeconomists learnt?

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  • Jagjit S. Chadha

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Abstract

I outline a simple roadmap for work in micro-founded models. Rather than abandoning the route to further micro-foundations and returning to ad hoc economics, the techniques we have used over the past two decades to develop micro-founded business cycle models will allow us to develop models with meaningful financial frictions and thus address once again the question of monetary and fiscal policies with active rather than passive financial sectors. Macroeconomics and finance are likely to remain bound together.

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File URL: ftp://ftp.ukc.ac.uk/pub/ejr/RePEc/ukc/ukcedp/1012.pdf
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Bibliographic Info

Paper provided by Department of Economics, University of Kent in its series Studies in Economics with number 1012.

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Date of creation: Dec 2010
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Handle: RePEc:ukc:ukcedp:1012

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Postal: Department of Economics, University of Kent at Canterbury, Canterbury, Kent, CT2 7NP
Phone: +44 (0)1227 764000
Fax: +44 (0)1227 827850
Web page: http://www.ukc.ac.uk/economics/

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Keywords: Future of Macroeconomics; DSGE Models; Crisis;

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