Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/185930
Authors: 
McCallum, Bennett T.
Year of Publication: 
2010
Citation: 
[Journal:] Swiss Journal of Economics and Statistics [ISSN:] 2235-6282 [Volume:] 146 [Year:] 2010 [Issue:] 1 [Pages:] 107-120
Abstract: 
To be useful as a guide to behavior, a model that includes a relationship between x_t and z_t+1 must specify whether x_t is influenced by the expectation at t of z_t+1 or, that z_t+1 is inertially influenced by x_t. We show that, for a broad class of linear RE models, distinct causal specifications will be uniquely associated with distinct solutions. Alternatively, a solution refinement requiring continuity of solution coefficients with respect to basic parameters implies this same solution. For a given structure there is only one RE solution that is fully consistent with the model's specification.
Subjects: 
determinacy
learnability
causality
continuity
JEL: 
E4
E5
E52
Persistent Identifier of the first edition: 
Creative Commons License: 
https://creativecommons.org/licenses/by/4.0/
Document Type: 
Article

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