Economic modeling in the post great recession era : incomplete data, imperfect markets / John Silvia, Azhar Iqbal, Sarah Watt House.

Format:

Book

Author/Creator:

Silvia, John, author.

Iqbal, Azhar (Economist), author.

House, Sarah Watt, 1985- author.

Series:

Wiley and SAS business series

Language:

English

Subjects (All):

Econometric models.

Economic conditions.

United States--Economic conditions--2009---Econometric models.

United States.

Econometric models--United States.

Recessions--United States.

Recessions.

Economic history.

Physical Description:

xxi, 378 pages ; 24 cm.

Place of Publication:

Hoboken, New Jersey : John Wiley & Sons, Inc., [2017]

Contents:

Chapter 1 Setting the Context 1

The Problem with Uncritical Assumptions in a Less-Than-Perfect Economy 2

The Problem with Models in an Imperfect Economy 3

Four Characteristics of a Less-Than-Perfect Economy 4

Economic Policy Inconsistencies-The Parable of Strange Bedfellows 13

Chapter 2 Dynamic Adjustment in an Economy: Frictions Matter 15

Introduction 16

Quantifying Frictions: Is the Long-Run Average a Useful Guide for the Future? 32

Modeling Dynamic Adjustment due to Economic Frictions: Decision Making in an Evolving World 49

Dynamic Economic Adjustment: An Evolution unto Itself 67

Appendix 68

A Case for the Multiple Markets: 1983-2008 68

The Labor Market: 1983-2008 70

Chapter 3 Information: Past Imperfect, Present incomplete, Future Uncertain 73

Story Behind the Numbers 76

Conclusion 103

Chapter 4 Price Adjustment and Search for Equilibrium 105

What Barriers Are There to Perfectly Flexible Prices? 107

Implications 112

Finding Dynamic Adjustment in the Data 116

Conclusion 121

Chapter 5 Business Investment: This Time Is Different 123

Drivers of Business Spending 125

Putting It All Together: Explaining Slow Recovery in Capital Investment 134

Chapter 6 Corporate Profits: Reward, Incentive, and That Standard of Living 135

Introduction: Profits as Essential Partner 136

The Role of Profits in the Economic Cycle: Five Drivers 137

The Role of Profits: Incentives and Rewards 140

Concluding Remarks: Modeling Profits 167

Chapter 7 Labor Market Evolution: implications for Private-Sector and Public-Policy Decision Makers 169

Part I Labor Market Imperfections 171

Part II Heterogeneity in the Labor Market 182

Part III How Do Secular Labor Market Trends Impact Economic Policy? 196

Chapter 8 Inflation: When What You Get isn't What You Expect 205

Introduction 206

What Is Inflation? 207

Why Does Inflation Matter? 208

What Determines Inflation? 212

Inflation after the Great Recession 219

Application: Predicting if Central Banks Can Achieve Price Stability 230

Chapter 9 Interest Rates and Credit: Capital Markets in the Post-Great Recession world 235

Imperfect Guidance in an Uncertain World 236

A Look at Actual History over the Long Run 247

Credit and Administered Rates 250

Imperfect Information and Credit 255

Conclusion: Shift from Historical Benchmarks 280

Chapter 10 Three-Dimensional checkers: Open Economy, Capital Flows, and Exchange Rates 281

Newton's Third Law 282

Introducing a New Price to the Analysis: The Role of Exchange Rates 289

Three-Dimensional Checkers on an International Playing Field 295

A Perfect Model in an Imperfect World 298

Concluding Remarks: Future Looks Different 330

Chapter 11 Assessing Economic Policy in an Imperfect Economy 331

Generalized Policy Model 333

Rules and Reputation: Beyond Economic Benchmarks 338

Confronting Our Three Market Imperfections 340

Economic Policy in the Context of an Imperfect Economy 359.

Notes:

Includes bibliographical references and index.

ISBN:

9781119349839

1119349834

OCLC:

957141046