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Do Chemical Reactors Hold the Solution for Global Economic Crises?

Author

Listed:
  • Yochanan Shachmurove

    (The City College of the City University of New York)

  • Reuel Shinnar (Deceased)

    (Department of Chemical Engineering, The City College of the City University of New York)

Abstract
What can economists learn from dynamic partial control of chemical reactors? Both chemical reactors and the economy involve many variables that are difficult to fully predict or control. Thus, this paper suggests the use of partial control, which involves indentifying only the key variables that monitor the system. This idea of observing relatively few variables and enabling policy makers to better control the economy is in line with the contributions of Sargent and Sims, who use a limited number of variables to study monetary and fiscal policies. This approach enables a better distinction between cause and effect in the macroeconomy.

Suggested Citation

  • Yochanan Shachmurove & Reuel Shinnar (Deceased), 2012. "Do Chemical Reactors Hold the Solution for Global Economic Crises?," PIER Working Paper Archive 12-010, Penn Institute for Economic Research, Department of Economics, University of Pennsylvania.
    • Handle: RePEc:pen:papers:12-010
    as

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    File URL: https://economics.sas.upenn.edu/sites/default/files/filevault/12-010.pdf
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    References listed on IDEAS

    as
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    Full references (including those not matched with items on IDEAS)

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    1. Econochemistry?
      by Economic Logician in Economic Logic on 2012-04-26 20:04:00

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    More about this item

    Keywords

    partial control; perturbation; steady state; monetary policy; economic growth; manufacturing; sufficiency; chemical reactors; delayed information model; Monte Carlo simulation; Kalman filter estimation;
    All these keywords.

    JEL classification:

    • P1 - Political Economy and Comparative Economic Systems - - Capitalist Economies
    • R1 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics
    • E5 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit
    • F4 - International Economics - - Macroeconomic Aspects of International Trade and Finance
    • L6 - Industrial Organization - - Industry Studies: Manufacturing
    • F1 - International Economics - - Trade
    • R1 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics

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