Post Walrasian Macroeconomics
Beyond the Dynamic Stochastic General Equilibrium Model

This collection outlines a new approach to macroeconomics that employs cutting edge analytic techniques.

David Colander (Edited by)

9780521865487, Cambridge University Press

Hardback, published 17 July 2006

440 pages, 9 tables
23.6 x 15.7 x 2.8 cm, 0.698 kg

"This impressive book contains contributions from some of the most inquisitive minds in economics.... [It] provides an excellent introduction...as well as clear indications of the direction that macroeconomics is moving toward." - Eastern Economic Journal

Macroeconomics is evolving in an almost dialectic fashion. The latest evolution is the development of a new synthesis that combines insights of new classical, new Keynesian and real business cycle traditions into a dynamic, stochastic general equilibrium (DSGE) model that serves as a foundation for thinking about macro policy. That new synthesis has opened up the door to a new antithesis, which is being driven by advances in computing power and analytic techniques. This new synthesis is coalescing around developments in complexity theory, automated general to specific econometric modeling, agent-based models, and non-linear and statistical dynamical models. This book thus provides the reader with an introduction to what might be called a Post Walrasian research program that is developing as the antithesis of the Walrasian DSGE synthesis.

Part I. Where We Are in Macro and How We Got There: 1. Stories from the haunted vault: notes on a century of macroeconomics
2. Post Walrasian macroeconomics: some historic links
3. The DSGE model and the post Walrasian alternative in historical perspective
4. Who is post Walrasian man?
Part II. Edging Away from the DSGE Model: 5. Social interactions and macroeconomics
6. Macroeconomics and model uncertainty
7. Restricted perceptions equilibria and learning in macroeconomics
8. Not more so: some concepts outside the DSGE framework
Part III. Leaping Away from the DSGE Model: 9. Agent-based computational modeling and macroeconomics
10. Multi-agent systems macro: a prospectus
11. Agent-based financial markets: matching stylized facts with style
Part IV. Doing More Good than Harm: Roles of Business and Government in Critical Infrastructure Protection: 12. Characteristics of resilient systems and organizations
13. Networks and interdependencies
14. Public - private risk-sharing: the case of terrorism risk coverage
15. Learning from experience: drawing correct analogies? Letting the data guide theory
16. The past as the future: the Marshallian approach to post Walrasian macro
17. Old world econometrics and New World theory
18. Four entrenched notions post Walrasians should avoid
19. Confronting the economic model with the data
20. Extracting information from the data: a European view on empirical macro
Part V. Policy Implications: 21. Economic policy in the presence of coordination problems
22. Monetary policy and the limitations of economic knowledge.

Subject Areas: Economic statistics [KCHS], Macroeconomics [KCB], Economic theory & philosophy [KCA], Research methods: general [GPS]