The Limits of EconometricsEconometric issues have provoked a lively and sometimes adversarial debate in the economics profession. The excitement and intellectual vitality of that debate is captured here for the reader in a lucid overview of econometric approaches, describing their advantages and limitations. This ambitious book focuses on the underlying methodological issues rather than concentrating upon econometric techniques. The limits of econometric investigations are identified through a critical appraisal of three different approaches associated with the work of Professors Hendry, Leamer and Sims. After explaining why the early optimism in econometrics was misplaced, it argues that rejection is not an appropriate response. It offers a rich spectrum of approaches to a problem of central importance in the development of modern economics. The book will appeal not only to all econometricians whatever their persuasion but also to all those with an interest in the methodology of economics. |
From inside the book
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... assumed functional form , f ) , and the rest is a remainder . This may be further decomposed if we assume that the function F is separable . Thus if we suppose that : F ( X ) = F1 ( X , .. X2 ) + F2 ( X , n + 1 ( where N need not be ...
... assumed correctness of the decisions made at that pre - test stage . Thus any testing of the assumptions regarding the nature of the error structure actually invalidates the use of traditional statistical theory in the testing of the ...
... assumed to have an additive error term ( encapsulating all errors , omissions and approximations ) which is assumed to behave as if it were a white noise random variable and the regressors are independent of the errors ; i.e. the errors ...
Contents
ECONOMICS DATA AND PROBABILITY | 3 |
Subjective probability | 10 |
The interpretation of the error as a white noise term | 18 |
Copyright | |
14 other sections not shown