How the basic RBC model fails to explain US time series

Research output: Journal Publications and Reviews (RGC: 21, 22, 62)21_Publication in refereed journalNot applicablepeer-review

6 Scopus Citations
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Author(s)

Detail(s)

Original languageEnglish
Pages (from-to)301-318
Journal / PublicationJournal of Monetary Economics
Volume41
Issue number2
Publication statusPublished - 27 Feb 1998
Externally publishedYes

Abstract

By examining the reduced form equations implied by an RBC model this paper shows how it fails in explaining the dynamic characteristics of the US time series using time-domain analysis. In particular, by studying the serial correlation of the residuals of the reduced form and by introducing lagged dependent variables, important propagation mechanisms left out in the model can be clearly discerned and reformations to improve the model can be evaluated.

Research Area(s)

  • C3, C5, Dynamic optimization, E2, E3, Real business cycle model

Citation Format(s)

How the basic RBC model fails to explain US time series. / Chow, Gregory C.; Kwan, Yum K.

In: Journal of Monetary Economics, Vol. 41, No. 2, 27.02.1998, p. 301-318.

Research output: Journal Publications and Reviews (RGC: 21, 22, 62)21_Publication in refereed journalNot applicablepeer-review