The goal of this paper is to review the method of stock flow consistent modeling to highlight areas in which it is deficient. I argue there is a fruitful research agenda in shoring up these deficiencies. The objective of stock flow modeling should be the ability to practically model unstable macro-economies, and in particular their interactions with the financial sector. These models should provide ‘Words to the Wise’, and until they do, they are just thought experiments.
Words to the Wise: Stock Flow Consistent Modeling of Financial Instability
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- Kinsella WordstotheWise (pdf, 465.2 KB)