Keynesian And Neoclassical Closures In An Agent-Based Context
AbstractSince the "closure debate" of the 1980s it is well known that com- parative static derivatives in analytical macro models are highly sensitive to the closure rule selected. This led Keynesians to conclude that Keynesian closures were superior to those favored by the orthodoxy and vice-versa. It is argued that with the advent of agent-based or multi-agent systems, the clo- sure debate is superseded. While elements of both Keynesian and neoclassical models survive the transition to the more synthetic environment, an agent- based approach eliminates the need for drastic simplification that was at the root of the debate from the beginning.
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Bibliographic InfoPaper provided by University of Massachusetts Amherst, Department of Economics in its series UMASS Amherst Economics Working Papers with number 2008-03.
Date of creation: Jan 2008
Date of revision:
Agent-based models; multi-agent systems; macroeconomic closure.;
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-02-09 (All new papers)
- NEP-CBE-2008-02-09 (Cognitive & Behavioural Economics)
- NEP-CMP-2008-02-09 (Computational Economics)
- NEP-MAC-2008-02-09 (Macroeconomics)
- NEP-PKE-2008-02-09 (Post Keynesian Economics)
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