Parameter Estimation for the Marxian Optimal Growth Model

Atsushi Tazoe

Research output: Contribution to journalArticle

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Abstract

In this article, we conduct an empirical analysis of a model called the Marxian Optimal
Growth Model proposed by Yamashita and Onishi (2002). Mathematically, the Yamashita-Onishi
model is the same as the neoclassical optimal growth model. Therefore, if analysis is limited to
the steady state in the Yamashita-Onishi model, it is possible to use the techniques of macroeconometrics
based on the dynamic stochastic general equilibrium model developed in the field
of mainstream macro-econometrics. Examination of the analysis results showed that most of
the discrepancies between the model and data are explained by error terms. To a certain extent,
this could have been foreseen from the unrealistic assumptions of the basic Yamashita-Onishi
model, and the fact that it was confirmed through actual analysis is significant. In this article, we
must also note the fact that, although a Bayesian estimation approach was used in the analysis,
the posterior distribution of the parameters derived as a result of the analysis is strongly affected
by the prior distribution. This trend is particularly striking due to the small number of data items
in the macroeconomic field.
Original languageEnglish
Pages (from-to)635-645
Number of pages11
JournalWorld Review of Political Economy
Volume2
Issue number2
Publication statusPublished - 2011
Externally publishedYes

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Growth model
Parameter estimation
Optimal growth
Bayesian estimation
Dynamic stochastic general equilibrium model
Posterior distribution
Econometrics
Empirical analysis
Macroeconomics
Discrepancy

Keywords

  • Marxian optimal growth model
  • parameter estimation
  • Japanese economy

Cite this

Parameter Estimation for the Marxian Optimal Growth Model. / Tazoe, Atsushi .

In: World Review of Political Economy, Vol. 2, No. 2, 2011, p. 635-645.

Research output: Contribution to journalArticle

Tazoe, Atsushi . / Parameter Estimation for the Marxian Optimal Growth Model. In: World Review of Political Economy. 2011 ; Vol. 2, No. 2. pp. 635-645.
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