Hybrid Workshop on Microfoundations in Measurement and Theory

The Research Centre of the Deutsche Bundesbank organizes a hybrid workshop on Microfoundations in Measurement and Theory. The neoclassical synthesis has laid down the microfoundation as the tenet dominant among macroeconomists since the 1930s. However, there is a huge micro-macro gap: the aggregates of many balance sheet items in the household survey (HS) cover only less than half of national accounts (NA) aggregates. This gap poses multiple challenges: 1) NA aggregates are the benchmark to recover a true distribution yet there is a disconnect to micro data; 2) all the microfounded macro researches and policy analysis maintain this zero gap assumption; 3) horizontal (or inter-sectoral) gap make the macroeconomic aggregates inconsistent.

A growing literature has emerged that aims to reconcile this micro-macro gap. Yet, the fundamental  positive (measurement) and normative (theoretical) questions on the origins of microfoundations have not been responded: Are the NA aggregates same as the bottom-up (exact) aggregation of their micro counterparts (in survey or even administrative data sources)? Should the NA aggregates (macro reality) always be a reflection of the bottom-up (exact) aggregation of their micro counterparts? There seems to be a multitude of reasons to challenge a positive answer to the positive question. We argue for a retroductive reasoning in redirecting our gap reconciliation efforts: Measurement efforts should reconsider the starting assumption (eg all and only the aggregates in NA should be distributed) when there is sufficient evidence that  the various aggregation theories are fragile; Theorists should search for the alternative perspective of methodological individualism when confronted with the positive evidence of the micro-macro gap..This workshop aims to highlight this issue and open an international debate on this fundamental topic.

Keynote Speakers

  • Kevin Hoover (Duke University)


Workshop on Microfoundations in Measurement and Theory (bundesbank.de)

Scientific Committee

  • Eddie Gerba (BoE, LSE and CES Ifo)
  • Kevin Hoover (Duke University)
  • Joachim Hubmer (University of Pennsylvania)
  • Christos Koulovatianos (University of Luxembourg)
  • Junyi Zhu (Deutsch Bundesbank)