Diks, C. (2006). Comments on 'Global Sunspots in OLG Models' Journal of Macroeconomics, 28(1):46--50.
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Affiliated author
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Publication year2006
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JournalJournal of Macroeconomics
This comment discusses the paper 'Global Sunspot Equilibria in OLG Models' by Gianluca Gazzola and Alfredo Medio with an emphasis on the importance of the role of dynamic noise in economic dynamics. After summarizing the main findings of the paper, the implications of dynamic noise for nonlinear time series analysis are discussed, and an empirical measure is suggested for establishing whether observed noisy time series data might have been generated by a stationary sunspot equilibrium of a given deterministic attractor. The discussion is illustrated with the analyses of some time series generated by the model studied by the authors.