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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... simultaneous equation system . 7. It is to be noted that this approach is that followed by some of the more recent texts : see , for example , the third edition of Johnston ( 1984 ) . 8. This echoes the view of Hendry ( 1985 ) ...
... systems of simultaneous equations with linear ( often exclusion ) restric- tions ; these restrictions are the standard means by which the identification problem is resolved.4 The importance of identification is that while it is ...
... system of simultaneous equations in which there are two sets of variables : exogenous and endogenous . With this endogenous / exogenous dichotomy , causation is defined to run from the exogenous variables to the endogenous variables ...
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