During the autumn of 2008 and the winter of 2009, the credit crises that originated in the US housing market spread to all developed economies and became a global job crisis. This crisis already has historical proportions, and like the depression of the e arly 1930s, and the stagflation period of the late 1970s, it is likely to lead to major reforms, and also to cause a re-orientation of the theories, data, and methodologies that economists use to make forecasts, and to inform policy decisions.
We propo se a PhD project with the dual aim of analyzing the causes and consequences of the ?credit crisis? with the aid of the existing, and of assessing those approaches in the light of the evidence presented by the crisis. The specific research areas that we p ropose are mainly related to the transmission mechanism , and the interaction between the real and financial sectors of the economy (Hidden over-determination in modern macroeconomic models, a source of low structural content?) , and are part of a wider p roject that aims at improving the relevance of econometrically based policy advice and forecasts. The working titles for 3 projects that will form part of the PhD thesis are:
- The transmission mechanism and the finical accelerator.
- Hidden over-dete rmination in modern macroeconomic models, a source of low structural content?
- Forecasting the recovery from the credit crises
These projects are motivated in the project proposal.