UNIT-ROOT HYPOTHESIS, NEW CLASSICAL AND KEYNESIAN MODELS

Authors
RAO BB
Citation
Bb. Rao, UNIT-ROOT HYPOTHESIS, NEW CLASSICAL AND KEYNESIAN MODELS, Economics letters, 41(1), 1993, pp. 47-52
Citations number
10
Categorie Soggetti
Economics
Journal title
Economics letters → ACNP
ISSN journal
01651765
Volume
41
Issue
1
Year of publication
1993
Pages
47 - 52
Database
ISI
SICI code
0165-1765(1993)41:1<47:UHNCAK>2.0.ZU;2-B
Abstract
Following Perron (Econometrica, 1989, 57, 1361-1401) the variables in the new classical and Keynesian output equations are shown to be trend stationary. Therefore these models are evaluated for the United State s with the standard non-nested hypothesis tests. The majority of these tests have rejected the new classical in favour of the Keynesian appr oach.