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The Quality of Quantitative Economic Policy-making when Targets and Costs of Change are Mis-specified

  • Arnold Zellner

Abstract

In a series of well-known works [3], [4], [5], [6], Tinbergen has made pioneering and outstanding contributions to the theory and application of quantitative economic policy-making (Q.E.P.).Tinbergen’s approach to Q.E.P. involves the following elements: (a) a criterion or welfare function that depends on certain economic variables, (b) a classification of variables into categories, target and non-target endogenous variables and instrumental and non-instrumental exogenous variables, (c) an econometric model involving relationships for variables and (d) boundary conditions for selected variables. Within this framework, which resembles closely the framework of modern control theory, Tinbergen provided simple, operational procedures for solving for values of policy instrument variables at a time when modern control theory was in its infancy.

Keywords

Loss Function Criterion Function Expected Loss Positive Definite Symmetric Matrix International Economic Review 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.

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References

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Copyright information

© Arnold Zellner 1974

Authors and Affiliations

  • Arnold Zellner
    • 1
  1. 1.Department of EconomicsUniversity of California at BerkeleyUSA

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