Generalising the RBC methodology for testing macro models (with Konstantinois Theodoridis)


Speaker:Patrick Minford, Cardiff University
Date: Friday 18 February 2005
Time: 16:15
Location: Lecture Room D, Streatham Court

Further details

We take a large macro model of the UK (the Liverpool model) and estimate it by FIML to obtain the best estimates conditional on the data. The question then is whether the model can replicate the 'facts of the business cycle'. We represent these facts by a VECM-GARCH process fitted to the main 5 macro variables. We then check via the bootstrap whether the Liverpool model is rejected by this representation.