Econometric Modelling of Private Consumption Using OECD National Accounts

Abstract

Although Colin Clark is well-known for his early major contributions to economic statistics and to debates on the conditions of economic progress, his various works on the use of economic statistics or national accounts in modelling micro and macroeconomic activities, especially in recent years, have also influenced numerous researchers in this area. In fact, while a Fellow in the Faculty of Economics and Politics at Monash University in Australia during the 1960s and 1970s, Colin Clark developed, among other empirical projects, a quarterly model of the US economy and regularly reported his findings at numerous international meetings. It was during his tenure of this position that I became a close associate and friend of Colin Clark and learned various aspects of his philosophy on the raison d’etre of applied economics, and particularly on contemporary econometric modelling. As he often enthused, a useful econometric model must be one that flies. An econometric model that flies (or ‘floats’ in the terminology of Lester Thurow, 1983) is one that is theoretically coherent and empirically data based.