scholarly journals Why macroeconomics needs experimental evidence

2021 ◽  
Author(s):  
John Duffy
Keyword(s):  
Experimental Evidence ◽  
Rational Expectations ◽  
Macroeconomic Policy ◽  
Experimental Methods ◽  
Household Consumption ◽  
Monetary Policies ◽  
Macroeconomic Models ◽  
Policy Interventions ◽  
Intertemporal Optimization

AbstractThis paper discusses how macroeconomics can and already has begun to make use of controlled experimental methods to address the assumptions and predictions of macroeconomic models as well as to evaluate the impacts of macroeconomic policy interventions. Specific issues addressed include rational expectations and alternatives, intertemporal optimization with an application to household consumption and savings decisions and the efficacy of various monetary policies.

Macroeconomic policy volatility and household consumption in Africa

2021 ◽  
Vol 1 (3) ◽  
Author(s):  
Ibrahim Ayoade Adekunle ◽  
Sheriffdeen Adewale Tella ◽  
Oluwaseyi Adedayo Adelowokan
Keyword(s):  
Macroeconomic Policy ◽  
Household Consumption

scholarly journals Loss Aversion and Consumption Choice: Theory and Experimental Evidence

2015 ◽  
Vol 7 (2) ◽  
pp. 101-120 ◽  
Author(s):  
Heiko Karle ◽  
Georg Kirchsteiger ◽  
Martin Peitz
Keyword(s):  
Experimental Evidence ◽  
Loss Aversion ◽  
Consumer Choice ◽  
Rational Expectations ◽  
Choice Theory ◽  
Choice Model ◽  
Reference Points ◽  
Price Uncertainty ◽  
Theoretical Predictions

We analyze a consumer-choice model with price uncertainty, loss aversion, and expectation-based reference points. The implications of this model are tested in an experiment in which participants have to make a consumption choice between two sandwiches. Participants differ in their reported taste for the two sandwiches and in their degree of loss aversion, which we measure separately. We find that more-loss-averse participants are more likely to opt for the cheaper sandwich, in line with theoretical predictions. The estimates in the model with rational expectations are slightly more significant than those with naïve expectations. (JEL D11, D12, D84, M31)

Quasi-rational expectations: Experimental evidence

1992 ◽  
Vol 11 (2) ◽  
pp. 141-156 ◽  
Author(s):  
Robert G. Nelson ◽  
David A. Bessler
Keyword(s):  
Experimental Evidence ◽  
Rational Expectations

EVOLUTIONARY ALGORITHMS IN MACROECONOMIC MODELS

2000 ◽  
Vol 4 (3) ◽  
pp. 373-414 ◽  
Author(s):  
Jasmina Arifovic
Keyword(s):  
Evolutionary Algorithms ◽  
Rational Expectations ◽  
Evolutionary Dynamics ◽  
Equilibrium Selection ◽  
Transitional Dynamics ◽  
Rational Expectations Equilibrium ◽  
Macroeconomic Models ◽  
Stability Of Equilibria ◽  
Long Run

This paper provides a survey of the applications of evolutionary algorithms in macroeconomic models. Discussion is organized around the issues related to stability of equilibria, equilibrium selection, transitional dynamics, and the long-run evolutionary dynamics different from rational-expectations equilibrium outcomes. The survey also discusses criteria that can be used to evaluate the performance and usefulness of evolutionary algorithms in the macroeconomic context.

The Role of Macroeconomic Models in the Policy Design Process

1995 ◽  
Vol 151 ◽  
pp. 53-64 ◽  
Author(s):  
Peter F. Westaway
Keyword(s):  
Design Process ◽  
Policy Design ◽  
Macroeconomic Policy ◽  
Policy Debate ◽  
Policy Options ◽  
Macroeconomic Models ◽  
Optimisation Techniques

This note examines the role of macroeconomic models in the policy design process. It discusses some of the general issues that need to be addressed if macroeconomic models are to make an important contribution to the policy debate. More topically, it illustrates the role that can be played by using policy optimisation techniques on the National Institute UK model to examine some of the macroeconomic policy options currently facing policymakers.

scholarly journals Institutions and Behavior: Experimental Evidence on the Effects of Democracy

2010 ◽  
Vol 100 (5) ◽  
pp. 2205-2229 ◽  
Author(s):  
Pedro Dal Bó ◽  
Andrew Foster ◽  
Louis Putterman
Keyword(s):  
Experimental Design ◽  
Experimental Evidence ◽  
Previous Literature ◽  
Selection Effects ◽  
Democratic Institutions ◽  
Policy Interventions ◽  
And Behavior

A novel experiment is used to show that the effect of a policy on the level of cooperation is greater when it is chosen democratically by the subjects than when it is exogenously imposed. In contrast to the previous literature, our experimental design allows us to control for selection effects (e.g., those who choose the policy may be affected differently by it). Our finding implies that democratic institutions may affect behavior directly in addition to having effects through the choice of policies. Our findings have implications for the generalizability of the results of randomized policy interventions. (JEL C91, D02, D12, D72)

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