This challenging and original book takes a fresh, innovative look at econometrics, and re-examines the scientific standing of structural econometrics as developed by the founders (Frisch and Tinbergen) and extended by Haavelmo and the Cowles modellers (particularly Klein) during the period 1930-1960. The authors begin by rethinking the scientific foundations of structural econometrics, offering a way around the problem of induction that also justifies the assumption of a 'data generating mechanism', and of ways to model this. They go on to explain how current critiques of the methodological...