Response to a Skeptic

Edward C. Prescott

Research output: Chapter in Book/Report/Conference proceedingChapter


New findings in science are always subject to skepticism and challenge. This is an important part of the scientific process. Only if new results successfully withstand the attacks do they become part of accepted scientific wisdom. Summers (in this issue) is within this tradition when he attacks the finding I describe (in this issue) that business cycles are precisely what economic theory predicts given the best measures of people’s willingness and ability to substitute consumption and leisure, both between and within time periods. I welcome this opportunity to respond to Summers’ challenges to the parameter values and the business cycle facts that I and other real business cycle analysts have used. In challenging the existing quality of measurement and not providing measurement inconsistent with existing theory, Summers has conceded the point that theory is ahead of business cycle measurement.

Original languageEnglish (US)
Title of host publicationReal business cycles
Subtitle of host publicationA Reader
PublisherTaylor and Francis
Number of pages6
ISBN (Electronic)9781134694792
ISBN (Print)0415165687
StatePublished - Jan 1 2013
Externally publishedYes

ASJC Scopus subject areas

  • Economics, Econometrics and Finance(all)
  • General Business, Management and Accounting


Dive into the research topics of 'Response to a Skeptic'. Together they form a unique fingerprint.

Cite this