Transmission of fiscal policy shocks into Romania's economy

Georgian Valentin Serbanoiu

MPRA Paper from University Library of Munich, Germany

Abstract: In this paper I use a medium scale open economy DSGE model developed by Baksa, Benk and Jakab (2010) for the Hungarian economy. This model provides a notable degree of disaggregation both on the government revenue and expenditure side, being able to capture the shocks that come from fiscal policy decisions. My contributions can be summed up in the following three actions. First of all, I estimated the model for the Romanian economy, using Bayesian techniques. Secondly, I determined the parameters of fiscal feedback rules in order to establish if the automatic stabilizers work properly. And thirdly, I tried to analyze the impulse response functions in order to assess the effects of different fiscal policy measures on the most important macroeconomic variables.

Keywords: DSGE model; Bayesian estimation; Fiscal policy; Procyclicality of fiscal policy; Impulse response functions; Fiscal feedback rules; Fiscal deficit; Government debt (search for similar items in EconPapers)
JEL-codes: E62 C68 H50 H30 C15 G28 E61 C11 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-dge, nep-mac and nep-tra
Date: 2012-06-28
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Persistent link: http://EconPapers.repec.org/RePEc:pra:mprapa:40947

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