Fiscal and Monetary Policy in an SFC Model of the Italian Economy

Francesco Zezza

Economics Working Paper Archive from Levy Economics Institute

Abstract: Following the Great Financial Crisis of 2008-9, there has been a shift in mainstream economic policy modeling toward "realism," with dynamic stochastic general equilibrium (DSGE) models partly diverging from the representative agent framework, and large-scale, New-Keynesian structural models addressing real-financial interactions in greater detail. Still, the need for tractability of the former, and the lack of theoretical structure of the latter prevented the complete introduction of a modern--and complex--multi-sector/multi-asset financial system in policy models in use at central banks and treasuries. However, empirical models adopting the Stock-Flow Consistent (SFC) approach resolved most of these complications with a surge in the number of country models over the last few years. The present work lays out the main out-of-sample features of a quarterly SFC model of the Italian economy (MITA).

Keywords: Empirical Stock-Flow Consistent Models; Monetary Policy; Fiscal Policy; Italy (search for similar items in EconPapers)
JEL-codes: C54 E12 E17 E44 E58 (search for similar items in EconPapers)
Date: 2024-12
New Economics Papers: this item is included in nep-cba, nep-dge, nep-fdg, nep-hme and nep-mon
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.levyinstitute.org/wp-content/uploads/2025/03/wp_1063.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:lev:wrkpap:wp_1063

Access Statistics for this paper

More papers in Economics Working Paper Archive from Levy Economics Institute
Bibliographic data for series maintained by Lindsey Carter ().