New Keynesian Model of the Small Open Czech Economy
| Authors | |
|---|---|
| Year of publication | 2006 |
| Type | Article in Proceedings |
| Conference | Proceedings of the 24th International Conference Mathematical Methods in Economics 2006 |
| MU Faculty or unit | |
| Citation | |
| Field | Economy |
| Keywords | New Keynesian DSGE model; New Open Economy Macroeconomics; monetary policy; Taylor rule; inflation targeting; rational expectations; Bayesian simulations |
| Description | The paper introduces a New Keynesian Dynamic Stochastic General Equilibrium (NK DSGE) model. This model is related to the New Open Economy Macroeconomics (NOEM). It is strictly based on microeconomic foundations and consists of representative agents. They are representative households and firms, a central monetary authority and a foreign economy. The economic model is log–linearized and transformed to a rational expectations (LRE) model, which is solved. Parameters of the solved model are estimated by Bayesian simulation techniques using a priory set information. The estimated model together with the impulse responses seems to give a reasonable approximation of behavior of the Czech economy. |
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