We construct models of group formation designed to capture some of the key features of political and social competition. The models draw on the ‘citizen candidate’ approach and allow competition to be modelled as either compromise - where all groups influence outcomes; or conflict -...

The policy implications of estimated macro-econometric systems depend on the formulations of their equations, the methodology of empirical model selection and evaluation, the techniques of policy analysis, and their forecast performance. Drawing on recent results in the theory of forecasting, we...

This paper considers the relationship between congruence and encompassing. Congruence is defined formally, and though it is not testable directly, it can be tested indirectly via tests of misspecification. Empirically more than one model can appear congruent, but that which encompasses its...

This retrospective provides a biographical history of Denis Sargan's career and reviews his contributions to econometrics, emphasizing the breadth of his work in both theoretical and applied econometrics. We include a complete bibliography for Denis and a list of PhD theses that he supervised -...

Using a panel of 23 industrialised countries, the paper investigates how short-run and long-run income risks are shared and how the source of uncertainty matters for the way this risk gets insured. Surprisingly, short-term and long-term output risks are found to be equally well insured....

This paper considers how the concepts of likelihood and identification became part of Bayesian theory. This makes a nice study in the development of concepts in statistical theory. Likelihood slipped in easily but there was a protracted debate about how identification should be treated....

This note explains the process of public opinion formation via a locally interactive, space-time analysis. The model we use is a special case of the general framework for modelling social interaction proposed in Blume and Durlauf (2001). In the reduced form of the model we study how each...

Rational Expectations models are tested here under the standard assumptions of the Expectations Hypothesis (EH) of interest rates. We examine the theoretical unbiasedness of the spread of interest rates by predicting changes in the shorter spot rates. Unit root tests are applied and VAR systems...

The South Sea Bubble of 1720 is often cited as an example of a fraud. It is often stated that the South Sea Company had not interest in, or aptitude for, the slave trade. It had been granted the monopoly right to ship slaves to the Spanish-held Americas. This paper uses shipping data to show...