Working Paper: NBER ID: w12349
Authors: N. Gregory Mankiw
Abstract: This essay offers a brief history of macroeconomics, together with an evaluation of what has been learned over the past several decades. It is based on the premise that the field has evolved through the efforts of two types of macroeconomist— those who understand the field as a type of engineering and those who would like it to be more of a science. While the early macroeconomists were engineers trying to solve practical problems, macroeconomists have more recently focused on developing analytic tools and establishing theoretical principles. These tools and principles, however, have been slow to find their way into applications. As the field of macroeconomics has evolved, one recurrent theme is the interaction—sometimes productive and sometimes not— between the scientists and the engineers.
Keywords: macroeconomics; Keynesian economics; new classical economics; new Keynesian economics
JEL Codes: No JEL codes provided
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Keynesian revolution (E12) | macroeconomic theory and practice (E65) |
| Keynesian principles (E12) | development of IS-LM framework (E12) |
| theoretical advancements (B52) | practical applications in economic policy (E65) |
| new classical economics (B20) | challenges to Keynesian consensus (E65) |
| shifts in theoretical paradigms (B52) | affect policy recommendations (D78) |
| theoretical progress (O41) | disconnect with practical policymaking (D78) |