1) A time series analysis updating the Mishkin study (circa 1980) of does money really matter.
It evaluates the question of does anticipated or unanticipated monetary policy changes
influence real GDP or the unemployment rate. It was one of the basic studies in
determining the authenticity of Keynesian versus Classical economics. You will need
to go on the internet, download the appropriate data, perform the necessary regressions and
analyze the results comparing the results to the original study. From the BEA and FRB
web sites gather quarterly real GDP and some money measure (M1, M2, MB, MZM). The
money measure will have to be deflated. In addition you will need additional economic
data that could be used to predict money growth. Reproduce the Mishkin analysis using
data since 1982 (including lags) to the present. A paper of the problem, analysis and
results is to be handed in on the day of the final. It would be useful to have Microsoft
Word with Microsoft Equation.
2) A regression analysis updating the study by Barro and Sala – I – Martin of income
convergence across states. Their study concluded that state’s income per capita were
converging to constant value and will at some time in the future be equal across all states.
One shortcoming of their analysis was that they considered only nominal income per capita,
not adjusted for inflation, and they did not consider cost of living differences across states.
You will need to download the appropriate data, perform the appropriate regression, and
analyze the results comparing the results to the original study. Gather state personal
income and population data from the BEA web site (annual probably OK). Also,
download an economic series to deflate real income. It would be helpful to locate
economic time series that measures the relative cost of living differences between states.
It may be OK to use state real GSP instead. This study also divided Classicals and
Keynesians. A paper of the problem, analysis and results is to be handed in on the day of
the final. It would be useful to have Microsoft Word with Microsoft Equation.
