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Autonomous Expenditures, Interest Rate Stabilization, and the St. Louis Equation

Sheldon H. Stein

The Review of Economics and Statistics 1980

O NE of the issues in the monetarist-fiscalist debate is whether it is more appropriate to obtain estimates of monetary and fiscal multipliers from structural models or reduced form equations. In recent years, Keynesians have challenged the results from reduced form equations on econometric grounds. They have argued that reduced form estimates are subject to bias if any of the following conditions exist:

DOI
10.2307/1927102
Volume
62 (3)
Pages
357
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