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From real business cycle and new Keynesian to DSGE Macroeconomics: facts and models in the emergence of a consensus

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  • Pedro Garcia Duarte

Abstract

Macroeconomists have emphasized the force of facts in forging a consensus understanding of business cycle fluctuations. According to this view, rival economists could no longer hold disparate views on the topic because “facts have a way of not going away” (Blanchard 2009). But how can macroeconomists observe the workings of an economy? Essentially through building and manipulating models. Thus the construction of macroeconomic facts –or “stylized facts”–, empirical regularities that come to be widely accepted, opens up technical spaces where macroeconomists negotiated their theoretical commitments and eventually allowed a consensus to emerge. I argue that this is an important element in the history of the DSGE macroeconomics.

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  • Pedro Garcia Duarte, 2015. "From real business cycle and new Keynesian to DSGE Macroeconomics: facts and models in the emergence of a consensus," Working Papers, Department of Economics 2015_05, University of São Paulo (FEA-USP).
  • Handle: RePEc:spa:wpaper:2015wpecon5
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    Cited by:

    1. Chatelain, Jean-Bernard & Ralf, Kirsten, 2018. "Publish and Perish: Creative Destruction and Macroeconomic Theory," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, pages 65-101.
    2. Francesco Sergi, 2015. "L'histoire (faussement) naïve des modèles DSGE," Documents de travail du Centre d'Economie de la Sorbonne 15066, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
    3. Muriel Dal-Pont Legrand & Harald Hagemann, 2019. "Impulses and Propagation Mechanisms in Equilibrium Business Cycles Theories: From Interwar Debates to DSGE "Consensus"," GREDEG Working Papers 2019-01, Groupe de REcherche en Droit, Economie, Gestion (GREDEG CNRS), Université Côte d'Azur, France.
    4. Francesco Sergi, 2015. "L'histoire (faussement) naïve des modèles DSGE," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-01222798, HAL.

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    More about this item

    Keywords

    DSGE models; history of macroeconomics; new Keynesian macroeconomics; real business cycles;
    All these keywords.

    JEL classification:

    • B22 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Macroeconomics
    • B23 - Schools of Economic Thought and Methodology - - History of Economic Thought since 1925 - - - Econometrics; Quantitative and Mathematical Studies
    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles

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