IDEAS home Printed from https://ideas.repec.org/a/ucp/jpolec/v97y1989i2p251-87.html
   My bibliography  Save this article

Two Models of Measurements and the Investment Accelerator

Author

Listed:
  • Sargent, Thomas J

Abstract

This paper describes two models of an agency that is collecting and reporting observations on a dynamical linear stochastic economy. The first is a "classical" model, with the agency reporting data that are the sum of a vector of "true" variables and a vector of measurement errors that are orthogonal to the true variables. The second is a model of an agency that uses an optimal filtering method to construct least-squares estimates of the true variables. These two models of the reporting agency imply different likelihood functions. A model of the investment accelerator is used as an example to illustrate the differing implications of the models. Copyright 1989 by University of Chicago Press.

Suggested Citation

  • Sargent, Thomas J, 1989. "Two Models of Measurements and the Investment Accelerator," Journal of Political Economy, University of Chicago Press, vol. 97(2), pages 251-287, April.
  • Handle: RePEc:ucp:jpolec:v:97:y:1989:i:2:p:251-87
    as

    Download full text from publisher

    File URL: http://dx.doi.org/10.1086/261603
    File Function: full text
    Download Restriction: Access to full text is restricted to subscribers. See http://www.journals.uchicago.edu/JPE for details.

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Groves, Theodore & Ledyard, John O, 1977. "Optimal Allocation of Public Goods: A Solution to the "Free Rider" Problem," Econometrica, Econometric Society, vol. 45(4), pages 783-809, May.
    2. Bohm, Peter, 1972. "Estimating demand for public goods: An experiment," European Economic Review, Elsevier, vol. 3(2), pages 111-130.
    3. Palfrey, Thomas R. & Rosenthal, Howard, 1984. "Participation and the provision of discrete public goods: a strategic analysis," Journal of Public Economics, Elsevier, vol. 24(2), pages 171-193, July.
    4. Hirshleifer, Jack, 1987. "Economic Behaviour in Adversity," University of Chicago Press Economics Books, University of Chicago Press, edition 1, number 9780226342825.
    5. Ferejohn, John A. & Forsythe, Robert & Noll, Roger G., "undated". "An Experimental Analysis of Decision-Making Procedures for Discrete Public Goods: A Case Study of a Problem in Institutional Design," Working Papers 155, California Institute of Technology, Division of the Humanities and Social Sciences.
    6. Ferejohn, John A. & Forsythe, Robert & Noll, Roger G. & Palfrey, Thomas R., "undated". "An Experimental Examination of Auction Mechanisms for Discrete Public Goods," Working Papers 262, California Institute of Technology, Division of the Humanities and Social Sciences.
    7. Reinhard Selten, 1974. "Reexamination of the Perfectness Concept for Equilibrium Points in Extensive Games," Center for Mathematical Economics Working Papers 023, Center for Mathematical Economics, Bielefeld University.
    8. Green, Jerry & Laffont, Jean-Jacques, 1977. "Characterization of Satisfactory Mechanisms for the Revelation of Preferences for Public Goods," Econometrica, Econometric Society, vol. 45(2), pages 427-438, March.
    9. Peter Bohm, 1972. "Estimating the demand for public goods: An experiment," Framed Field Experiments 00126, The Field Experiments Website.
    10. Marwell, Gerald & Ames, Ruth E., 1981. "Economists free ride, does anyone else? : Experiments on the provision of public goods, IV," Journal of Public Economics, Elsevier, vol. 15(3), pages 295-310, June.
    11. Bliss, Christopher & Nalebuff, Barry, 1984. "Dragon-slaying and ballroom dancing: The private supply of a public good," Journal of Public Economics, Elsevier, vol. 25(1-2), pages 1-12, November.
    12. Smith, Vernon L, 1979. " An Experimental Comparison of Three Public Good Decision Mechanisms," Scandinavian Journal of Economics, Wiley Blackwell, vol. 81(2), pages 198-215.
    13. Oliver Kim & Mark Walker, 1984. "The free rider problem: Experimental evidence," Public Choice, Springer, vol. 43(1), pages 3-24, January.
    14. Lipnowski, Irwin & Maital, Shlomo, 1983. "Voluntary provision of a pure public good as the game of `chicken'," Journal of Public Economics, Elsevier, vol. 20(3), pages 381-386, April.
    15. Mark Isaac, R. & McCue, Kenneth F. & Plott, Charles R., 1985. "Public goods provision in an experimental environment," Journal of Public Economics, Elsevier, vol. 26(1), pages 51-74, February.
    16. Martin McGuire, 1974. "Group size, group homo-geneity, and the aggregate provision of a pure public good under cournot behavior," Public Choice, Springer, vol. 18(1), pages 107-126, June.
    17. Bohm, Peter, 1984. "Revealing demand for an actual public good," Journal of Public Economics, Elsevier, vol. 24(2), pages 135-151, July.
    18. Banks, Jeffrey S. & Plott, Charles R. & Porter, David P., "undated". "An Experimental Analysis of Public Goods Provision Mechanisms with and without Unanimity," Working Papers 595, California Institute of Technology, Division of the Humanities and Social Sciences.
    19. Jack Hirshleifer, 1983. "From weakest-link to best-shot: The voluntary provision of public goods," Public Choice, Springer, vol. 41(3), pages 371-386, January.
    20. Peter Bohm, 1984. "Revealing demand for an actual public good," Framed Field Experiments 00129, The Field Experiments Website.
    21. Friedrich Schneider & Werner W. Pommerehne, 1981. "Free Riding and Collective Action: An Experiment in Public Microeconomics," The Quarterly Journal of Economics, Oxford University Press, vol. 96(4), pages 689-704.
    22. Smith, Vernon L, 1977. "The Principle of Unanimity and Voluntary Consent in Social Choice," Journal of Political Economy, University of Chicago Press, vol. 85(6), pages 1125-1139, December.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ucp:jpolec:v:97:y:1989:i:2:p:251-87. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Journals Division). General contact details of provider: http://www.journals.uchicago.edu/JPE/ .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.