Abstract
Decision theory offers a number of approaches to problems of applied economics and policy advising. In addition, application of these approaches also directs the discussion not just at the results but also at the underlying goals and structures.
The experience with the control of the macroeconomic model for the Federal Republic of Germany, developed by the five large German economic research institutes, shows that optimizing approaches with explicitly stated and not necessarily linear objective functions seem to be suited for this purpose.
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Footnotes and references
Ifo-Institut für Wirtschaftsforschung (Hrsg.), Jahresbericht 1979, Manchen 198O,p. 5.
For different specifications of the control problem in macroeconomic studies see Kendrick, D.A., Applications of Control Theory to Macroeconomics, Annals of Economic and Social Measurement, 6 (1976), p. 171–185.
See Goldfeld, S.M., Quandt, R.F., and Trotter, H.F., Maximization by Quadratic Hill-Climbing, Econometrica, 34 (1966), p. 541–551.
Applications of the GQT-algorithm can be found for example in Chow, G.C., How Much Could Be Gained by Optimal Stochastic Control Policies, Annals of Economic and Social Measurement, 1 (1972), p. 391–406.
Fair, R.C., On the Solution of Optimal Control Problems as Maximization Problems, Annals of Economic and Social Measurement, 3 (1974), p. 135–154
Fair, R.C., Rustem, R. and Zarrop, M.B., Newton-Type Methods for the Optimization and Control of Nonlinear Econometric Models, Discussion Paper No. 25, Programme of Research into Econometric Methods, London 1978.
An interpretation and solution of the decision model to determine distribution functions of grouped income data is described in Körner,J. and RieB, H.C., Methoden zur mehrjährigen Vorausschätzung des Einkommensteueraufkommens, Ifo-Studien zur Finanzpolitik Nr. 25, Manchen 1980, p. 164–222.
A description of the initial version of the model is contained in Rau, R., Heile-mann, U., Korthaus, E. und München, H.J., Das RWI-Konjunkturmodell, Essen 1977.
Presently a series of model versions and model applications exists, such asPPRau, R., Heilemann, U. und München, H.J., Struktur und Prognoseleistung des RWI-Konjunkturmodells, Mitteilungen des Rheinisch-Westfälischen Instituts für Wirtschaftsforschung, Essen 1977/2, p. 103–136.
Rau, R., Konjunkturprognose für 1979: Simulation mit veränderten Annahmen, Mitteilungen des RWI, Essen 1978 /3, p. 207–221.
Heilemann, U., Die Bestimmung der Einnahmen und Ausgaben des öffentlichen Sek- tors im RWI-Konjunkturmodell, Mitteilungen des RWI, Essen 1979/3, p. 179–203.
Zwiener, R., Weiterentwicklung des kurzfristigen ökonometrischen Modells der Wirtschaftsforschungsinstitute, Vierteljahreshefte des Deutschen Instituts für Wirtschaftsforschung (DIW), Berlin 1981.
Fischer, J. and Uebe, G, G., “Optimal” Control of the RWI-Model, Paper presented at the Seminar on Econometric Decision Models, University of Hagen, June 1981.
Gesetz zur Förderung der Stabilität und des Wachstums der Wirtschaft vom 8. Juni 1967, Bundesgesetzblatt, Jahrgang 1967, Teil I, pp. 582.
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Rieß, H.C. (1983). Some Experiences with the Control of a Macroeconometric Model with a Scalarvalued Objective Function from the Viewpoint of Applied Economic Research. In: Gruber, J. (eds) Econometric Decision Models. Lecture Notes in Economics and Mathematical Systems, vol 208. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-46464-5_4
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DOI: https://doi.org/10.1007/978-3-642-46464-5_4
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