A Baseline Closed Economy Model for Monetary Policy Analysis
| Authors | |
|---|---|
| Year of publication | 2009 |
| Type | Article in Periodical |
| Magazine / Source | Bulletin of the Czech Econometric Society |
| MU Faculty or unit | |
| Citation | |
| Field | Economy |
| Keywords | DSGE; New Keynesian model; Bayesian estimation; impulse responses |
| Description | The paper provides an analysis of the baseline New Keynesian DSGE model for a closed economy. The model is estimated with a Bayesian technique using quarterly Eurozone data. The estimation results are discussed and compared with related papers. Via impulse responses to unanticipated shocks, we analyze the behaviour of the model. We carry out this analysis in three steps. First, we analyze the model behaviour without any rigidities in order to understand essential model mechanisms. Then, we add separately real and nominal rigidities to investigate their impacts within the model. |
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