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Agent-based Macroeconomics and Dynamic Stochastic General Equilibrium Models: Where do we go from here?

Dilaver, Ozge, Jump, Robert and Levine, Paul (2016) Agent-based Macroeconomics and Dynamic Stochastic General Equilibrium Models: Where do we go from here? [Working Paper]

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Abstract

Agent-based computational economics (ACE) has been used for tackling major research questions in macroeconomics for at least two decades. This growing field positions itself as an alternative to dynamic stochastic general equilibrium (DSGE) models. In this paper we first review the arguments raised against DSGE in the ACE literature. We then review existing ACE models, and their empirical performance. We then turn to a literature on behavioural New Keynesian models that attempts to synthesise these two approaches to macroeconomic modelling by incorporating some of the insights of ACE into DSGE modelling. We highlight the individually rational New Keynesian model following Deak et al. (2015) and discuss how this line of research can progress.

Item Type: Working Paper
Divisions : Faculty of Arts and Social Sciences > School of Economics
Authors :
NameEmailORCID
Dilaver, Ozgeo.dilaver@surrey.ac.uk
Jump, Robert
Levine, PaulP.Levine@surrey.ac.uk
Date : January 2016
Funders : Economic and Social Research Council (ESRC)
Uncontrolled Keywords : Agent-based computational economics; Agent-based macroeconomics; Dynamic stochastic general equilibrium models; New Keynesian behavioural models
Related URLs :
Additional Information : Handle: RePEc:sur:surrec:0116
Depositing User : Clive Harris
Date Deposited : 05 Feb 2018 13:51
Last Modified : 19 Jun 2018 06:14
URI: http://epubs.surrey.ac.uk/id/eprint/845742

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