Of course, I'm skeptical about the VAR technique, but the paper doesn't interesting job of showing that the data is more consistent with a Fed policy of fighting low unemployment than inflation.
Michael Perelman Economics Department California State University michael at ecst.csuchico.edu Chico, CA 95929 530-898-5321 fax 530-898-5901 michaelperelman.wordpress.com -----Original Message----- From: PEN-L list [mailto:[EMAIL PROTECTED] On Behalf Of Jim Devine Sent: Monday, September 03, 2007 7:39 AM To: [email protected] Subject: Re: [PEN-L] Galbraith's new paper I haven't read that paper, but can VAR "prove" anything? On 9/2/07, Perelman, Michael <[EMAIL PROTECTED]> wrote: > Has anyone looked at this? Jaimie uses a VAR model to show that the Fed > targets low unemployment rather than inflation and that it acts > politically to promote Republicans and presidential elections. > > > > Levy Working Paper No. 511 > The Fed's Real Reaction Function > Monetary Policy, Inflation, Unemployment, > Inequality-and Presidential Politics* > James K. Galbraith > Olivier Giovannoni > Ann J. Russo > August 2007 > > > Michael Perelman > Economics Department > California State University > michael at ecst.csuchico.edu > Chico, CA 95929 > 530-898-5321 > fax 530-898-5901 > www.michaelperelman.wordpress.com > -- Jim Devine / "In the years since the phrase became a cliché, I have received any number of compliments for my supposed ability to 'think outside the box.' Actually, it has been a struggle for me to perceive just what these 'boxes' were - why they were there, why other people regarded them as important, where their borderlines might be, how to live safely within and without them." -- Tim Page (THE NEW YORKER, August 20, 2007).
