Again, if econometricians
fully understood the endogeneity they confronted, this wouldn't be an issue.
Suppose an econometrician
has access to a sample of data from this DGP, but does not know the true form of the underlying model.
Basmann, "The Professional Responsibility of the Econometrician
for Truthfulness in the Teaching of Economics," in Educating Economists, eds.
The door of his home was always open to visitors, and a large number of econometricians
and friends over the years had a chance to enjoy the warm hospitality of Clive and his wife Patricia Lady Granger.
I was not fond of the dry tools of linear algebra used by Fisher and other econometricians
to study identification of simultaneous linear systems.
Unfortunately for econometricians
, government spending during those wars was not increased in isolation: both also featured major tax increases and (especially World War II) the use of command-and-control measures.
A more academically oriented economics book would probably not have apologized for statistical technique in making the same point, or relegated these studies to Chapters 11 to 14 at the end, but this book is primarily aimed at activists, not econometricians
(nope, me neither) have been studying the Playboy archives (nope, me neither) and discovered that when times are hard and money is tight, the males of our species prefer older, taller, more muscular women.
The best way I can illustrate this idea is to relate the story of the three econometricians
who went hunting one day.
If such efforts were made, I am sure one group of brilliant econometricians
would find a causal linkage which showed that oil price movements were caused by changes in the exchange rate while a second equally brilliant group would find the reverse.
Therefore, following Campbell and Shiller (1987) and Engel and West (2005), the exchange rate is likely to embody important information about future commodity price movements well beyond what econometricians
can capture with simple time-series models.
are left with the difficult task of isolating the effect of a funds rate increase on variables such as output and inflation.