Bifurcation of Macroeconometric Models and Robustness of Dynamical Inferences

Barnett, William A.; Chen, Guo

doi:10.1561/0800000026

Cited by 17 publications

(14 citation statements)

References 68 publications

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“…While our cross section results are strong, even more dramatic results might be found by extending to nonlinear dynamical models capable of producing bifurcation. See Barnett and Chen (2015) regarding that research opportunity.…”

Section: Discussionmentioning

confidence: 99%

Does the utilization of information communication technology promote entrepreneurship: Evidence from rural China

Barnett

Xue

2019

Technological Forecasting and Social Change

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Impacts on the probability of transition to entrepreneurship in rural China associated with the utilization of information communication technology (ICT) are estimated using longitudinal data from the China Family Panel Studies (CFPS) survey. We identify cell phone ownership and internet use as proxy variables for ICT utilization and find that cell phone ownership and internet use have positive impacts on entrepreneurship. After controlling for observables and time and regional fixed effects, cell phone users (internet users) are 2.0 (6.4) percentage points more likely to engage in entrepreneurship than the others. Considering that the average entrepreneurship rate for rural households is only 9.5% in the sample, the influence of cell phone ownership and internet use are very strong in the economic sense. Our results are robust to unobservable individual characteristics, model misspecification, and reverse causality of entrepreneurship to ICT utilization. Evidence also suggests that social network and information and knowledge acquisition play the mediating roles in the impact of ICT utilization on entrepreneurship.

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Section: Discussionmentioning

confidence: 99%

Does the utilization of information communication technology promote entrepreneurship: Evidence from rural China

Barnett

Xue

2019

Technological Forecasting and Social Change

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“…On the other hand, determinacy, as required by rational expectations theory, is often associated with a positive feedback mechanism in the New-Keynesian setting. Barnett and Chen (2015) and Duzhak (2008, 2010), therefore, emphasize the importance of bifurcations in the reference New-Keynesian macroeconomic model (Gali (2015)). The Taylor rule parameters (the response of the interest rate to in ‡ation or to the output gap) are bifurcation parameters.…”

Section: Hopf Bifurcation From New-keynesian Taylor Rule To Ramsey Opmentioning

confidence: 99%

Hopf Bifurcation from New-Keynesian Taylor Rule to Ramsey Optimal Policy

Chatelain

Ralf

2017

SSRN Journal

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This paper shows that a shift from Ramsey optimal policy under short term commitment (based on a negative-feedback mechanism) to a Taylor rule (based on positive-feedback mechanism) in the new-Keynesian model is in fact a Hopf bifurcation, with opposite policy advice. The number of stable eigenvalues corresponds to the number of predetermined variables including the interest rate and its lag as policy instruments for Ramsey optimal policy. With a new-Keynesian Taylor rule, however, these policy instruments are arbitrarily assumed to be forward-looking variables when policy targets (inflation and output gap) are forward-looking variables. For new-Keynesian Taylor rule, this Hopf bifurcation implies a lack of robustness and multiple equilibria if public debt is not set to zero for all observation

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“…See Barnett and Chen (2015), who survey a large number of such bifurcation boundary searches over models spanning all modern classes of macroeconometric models, including recent models with rational Of course, it is not necessary to be a "rocket scientist" to recognize that there are serious problems with the availability and quality of macroeconomic data. Media reporters with no knowledge of bifurcation have been complaining about those data for years.…”

Section: Measurementmentioning

confidence: 99%

“…For example, there have been studies of new Keynesian models with Taylor rules or inflation targeting equations under various assumptions about "active" versus "passive" and forward-looking versus backward-looking rules. For surprising results from systematic investigation for bifurcation boundaries within the parameter space of such models, see section 4 of Barnett and Chen (2015). Coauthorship and publication were not constrained at the Federal Reserve to the same degree as at Rocketdyne, since there are no national security clearance issues.…”

Section: Measurementmentioning

confidence: 99%

Bifurcation of Macroeconometric Models and Robustness of Dynamical Inferences

Cited by 17 publications

References 68 publications

Does the utilization of information communication technology promote entrepreneurship: Evidence from rural China

Does the utilization of information communication technology promote entrepreneurship: Evidence from rural China

Hopf Bifurcation from New-Keynesian Taylor Rule to Ramsey Optimal Policy

Collaboration With and Without Coauthorship: Rocket Science Versus Economic Science

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