Sunday, January 26, 2014

Lars P. Syll — Out of the frying pan into the fire — DSGE and Ricardian equivalence


... I totally agree that macroeconomic models have to abandon Ricardian equivalence nonsense. But replacing it with “overlapping generations” and “infinite-horizon” models — isn’t that — in terms of realism and relevance — just getting out of the frying pan into the fire?
Out of the frying pan into the fire — DSGE and Ricardian equivalence
Lars P. Syll | Professor, Malmo University

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