This paper examines monetary and fiscal policy through the estimation of a New-Keynesian dynamic general equilibrium model for Iran’s economy. In this New-Keynesian dynamic general equilibrium model, the consumers encounter the liquidity constraint and the firms face sticky prices, while they are changing them. In the model presented, a role is considered for both government spending and taxati...

T he global financial crisis and recession that started in 2007 with the surge of defaults of U.S. subprime mortgages is having a large impact on recent macroeconomic research. The framework of modern macroeconomics that has replaced traditional Keynesian economics since the 1970s has been widely criticized. Many of the criticisms have focused on the assumptions of the representative agent and ...

A. Topics and Tools ............................................................................ 1 B. The Lucas Model in Historical Perspective ............................................ 2 Keynesian macroeconomics in the 1960s ......................................................................... 2 Monetarism ....................................................................................

This paper studies an agent-based model that bridges Keynesian theories of demandgeneration and Schumpeterian theories of technology-fueled economic growth. We employ the model to investigate the properties of macroeconomic dynamics and the impact of public polices on supply, demand and the “fundamentals” of the economy. We find that the complementarities between factors influencing aggregate d...

We construct a model to capture the Keynesian idea that production and employment decisions are based on expectations of aggregate demand driven by sentiments, and that realized demand follows from the production and employment decisions of firms. We cast the Keynesian idea into a simple model with imperfect information about aggregate demand and we characterize the rational expectations equili...