Data and Code for: The Evolving Core of Usable Macroeconomics for Policymakers

Principal Investigator(s): View help for Principal Investigator(s) Alessandro Villa, Federal Reserve Bank of Chicago; Jonas Fisher, Federal Reserve Bank of Chicago; Bart Hobijn, Federal Reserve Bank of Chicago

Version: View help for Version V1

Name	File Type	Size	Last Modified
data			04/15/2025 04:14:PM
Figure.pdf	application/pdf	79.4 KB	04/15/2025 12:11:PM
FisherHobijnVillaAEAPP2025_replication.py	text/x-python	13.6 KB	04/15/2025 12:11:PM
README.pdf	application/pdf	103.7 KB	04/15/2025 12:11:PM

Project Citation:

Villa, Alessandro, Fisher, Jonas , and Hobijn, Bart. Data and Code for: The Evolving Core of Usable Macroeconomics for Policymakers. Nashville, TN: American Economic Association [publisher], 2025. Ann Arbor, MI: Inter-university Consortium for Political and Social Research [distributor], 2025-05-27. https://doi.org/10.3886/E226863V1

Project Description

Summary: We provide a brief primer on how the core of usable macroeconomic theory for monetary policymakers has evolved over the past 50 years. Today’s policy discussions center on the New Keynesian (NK) synthesis, which builds on the Neoclassical growth model and the AS-AD framework. It incorporates nominal and real rigidities, financial and labor market frictions, the importance of expectations, and inspired terms used by policymakers such as “anchored inflation expectations” and “forward guidance.” While essential for communication during the Great Recession and COVID-19 pandemic, these events also revealed the NK model's limitations. Newer models incorporating heterogeneous agents potentially offer richer policy insights but add complexity and the challenge of distilling their main policy implications going forward.

Scope of Project

Subject Terms: History of economic thought; monetary policy

JEL Classification:
B22 History of Economic Thought: Macroeconomics
E50 Monetary Policy, Central Banking, and the Supply of Money and Credit: General

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Published Versions

V1 [2025-05-27]

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DDI 2.5

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