Macroeconomic models and assumptions have traditionally been evaluated using non-experimental "field" data. However, in many instances the field data necessary to evaluate such models and assumptions are not available. Recently, researchers have begun to explore ways of implementing
micro-founded macroeconomic models in the controlled conditions of the experimental laboratory as an alternative means of gathering the data necessary to address the empirical relevance of macroeconomic models and assumptions as well as to understand questions of equilibrium selection or policy
prescriptions. This volume is the first-ever collection of laboratory studies aimed at understanding macroeconomic phenomena. The chapters, by leading researchers in the field, explore consumption behavior, expectation formation, monetary economics and central bank policy in a variety of different
macroeconomic models. Readers will come away with a better understanding of how to implement macroeconomic models in the laboratory and the valuable insights that laboratory research can bring to our understanding of macroeconomics.
This volume contains new important research on banking institutions and performance in transition economies, economic growth and inequality and exchange rate economics and international finance. Topics include exchange rate exposure of firms, the relationship between monetary policy and house price
shocks, economic interdependence of south-eastern European countries, China's exchange rate policy and economic growth, inequality and financial sector. Among the questions answered are: Is exchange rate volatility a significant determinant of average firm level exposure? Can we identify shocks that
can be interpreted as loose monetary shocks, low inflation shocks, banks credit shocks and house price shocks? What are the main factors driving the relationship between banks and companies in transition economies? Does it matter for forecasting GDP growth whether the economy is in tranquil times or
during a period of turbulence? Has economic growth played any role in reducing inequality in South Africa? Are global bilateral investment holdings characterized by strong persistence? And finally, Is China's international competitiveness fluctuates in consistency with PPP equilibrium?