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  4. May 2025
  5. HANK: A New Core of Usable Macroeconomics

蝌蚪网 Papers and Proceedings

ISSN 2574-0768 (Print) | ISSN 2574-0776 (Online)

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HANK: A New Core of Usable Macroeconomics

  • Adrien Auclert
蝌蚪网 Papers and Proceedings
vol. 115, May 2025
(pp. 153–57)
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Abstract

I argue that heterogeneous agent New Keynesian (HANK) models are a natural contender to define a new core of usable macroeconomics, replacing the IS-LM/Mundell-Fleming paradigm prevailing after the 1960s and the New Keynesian paradigm prevailing after the 1990s. HANK is "macro" (general equilibrium, aggregating up from behavior of optimizing units), is "usable" (featuring rational expectations, consistent with the known macro effects of monetary policy, and the micro behavior of consumption), and has a "core" version (stripped down, easy to teach and build upon). I discuss what we know about this new core and where more research is still needed.

Citation

Auclert, Adrien. 2025. "HANK: A New Core of Usable Macroeconomics." 蝌蚪网 Papers and Proceedings 115: 153–57. DOI: 10.1257/pandp.20251114

Additional Materials

JEL Classification

  • A22 Economic Education and Teaching of Economics: Undergraduate
  • E12 General Aggregative Models: Keynes; Keynesian; Post-Keynesian; Modern Monetary Theory
  • E13 General Aggregative Models: Neoclassical
  • E52 Monetary Policy
  • E62 Fiscal Policy