An Application of a Structural VAR Technique to Interpret UK Macroeconomic Fluctuations

In the last few years new techinques able to help in explaining macroeconomic fluctuations have been developed. Following the article o fBlanchard (1989), concerning US macroeconomic data we will examine the UK economy using a new methodology, the so called "Structural" VAR analysis, developed by Giannini (1992). We will compare the UK economy with the Italian and the US ones and point out both similarities and peculiarities. This "traditional interpretation", applied to the UK economy shows some problems of consistency with "Keynesian" view of economy.