HOW IMPORTANT IS DISAGGREGATION IN STRUCTURAL MODELS OF INTEREST RATE DETERMINATION?

A rapidly developing literature is currently investigating the determination of interest rates through the conceptual approach of the structural model. In brief, a structural model of asset prices is simply the combination of a representation of investors' demand for securities and a representation...

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Publicado en:Review of Economics & Statistics Vol. 62; no. 2; pp. 271 - 277
Autor principal: Friedman, Benjamin M.
Formato: Artículo
Publicado: MIT Press May80
Materias:
Acceso en línea:Ver este registro en EBSCOhost
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        atl: HOW IMPORTANT IS DISAGGREGATION IN STRUCTURAL MODELS OF INTEREST RATE DETERMINATION?
      aug:
        au: Friedman, Benjamin M.
      su:
        Interest rates
        Economics
        Investors
        Economic indicators
        Friedman, Benjamin M.
        Financial markets
        Structural frame models
      sug:
        subj:
          Interest rates
          Economics
          Investors
          Economic indicators
          Friedman, Benjamin M.
          Financial markets
          Structural frame models
      ab: A rapidly developing literature is currently investigating the determination of interest rates through the conceptual approach of the structural model. In brief, a structural model of asset prices is simply the combination of a representation of investors' demand for securities and a representation of borrowers' supply of securities, together with a market clearing condition. Such a model stands in contrast to the traditional approach of modeling interest rate determination using an unrestricted reduced form of equation with the particular interest rate in question as the dependent variable. The results, presented in the article, demonstrate that the structural modeling approach to interest rate determination not only stands apart from the sectoral disaggregation question conceptually but also performs fairly well without sectoral disaggregation empirically. The article presents estimation and dynamic simulation results for an aggregated equivalent to the disaggregated model of the determination of bond yields developed in Benjamin M. Friedman.
      pubtype: Academic Journal
      doctype: Article
      src: R
    language: English
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