RT Report
T1 The modern view of macroeconomics : some critical reflections
A1 Palacio Vera, Alfonso
AB Romer has proposed an alternative macroeconomic framework, i.e., the IS-MP-IA model. Its proponents claim that it constitutes a ‘modern’ view of macroeconomics. We show that the new framework is closely attached to the neoclassical synthesis and, in addition, fails to take account of: (i) the recent empirical evidence on the short-run output-inflation trade-off, (ii) the recent work and evidence on the interdependence of aggregate demand and supply, (iii) the limits of monetary policy and (iv) the consequences for demand-management policy of (i), (ii) and (iii). Once all these aspects are incorporated, we have that short-run stabilization policy is non-neutral in the long run, loanable funds theory becomes irrelevant and aggregate demand becomes the crucial exogenous variable in the short run and, perhaps, also in the long run.
PB Facultad de Ciencias Económicas y Empresariales. Decanato
SN 2255-5471
YR 2002
FD 2002
LK https://hdl.handle.net/20.500.14352/64471
UL https://hdl.handle.net/20.500.14352/64471
LA eng
NO Códogos JEL: A22, E10, E50, E60
DS Docta Complutense
RD 8 abr 2025