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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... evidence in favour of the existence of a stable relationship between the aggregate demand for real balances and a few variables is overwhelming ' ( Laidler , 1971 , p . 91 ) and ' there is an over- whelming body of evidence in favor of ...
... evidence favours one hypothesis relative to another depending on whether or not the Bayes factor exceeds unity ( i.e. whether or not the data evidence enhances or reduces the prior odds , independent of the posterior odds per se ) . i A ...
... evidence is partly spent to pick a data set , the regression equation that is finally selected to convey the data evidence at least overstates the precision of the evidence and likely distorts it as well [ sic ] ' ( p . 259 ) . This ...
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