Animal spirits, persistent unemployment and the belief function
By: Roger E.A. Farmer
Contributors: National Bureau of Economic Research
Series: NBER working paper series -- working paper 16522; Working paper series (National Bureau of Economic Research : Online) -- working paper no. 16522.
Publisher: National Bureau of Economic Research
Published: 2010
Place of publication: Cambridge, MA
Language: eng
Format: [electronic resource] /
Description: "This paper presents a theory of the monetary transmission mechanism in an old-Keynesian model with multiple equilibrium unemployment rates.  The model has two equations in common with the new-Keynesian model; the optimizing IS curve and the policy rule.  It differs from the new-Keynesian model by replacing the Phillips curve with a belief function to determine expectations of nominal income growth.  I estimate the new and old-Keynesian models using U.S.  data and I show that the old-Keynesian model fits the data better than its new-Keynesian competitor"--National Bureau of Economic Research web site.
Notes: Title from PDF file as viewed on 3/22/2011.

Includes bibliographical references.

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