Bulgaria’s Cyclical Position and Market (Dis)equilibria

Ivan Todorov

Economic Studies journal, 2017, issue 5, 30-64

Abstract: Bulgaria’s potential output and cyclical position for the period 2010-2015 are estimated by a methodology based on a two-factor Cobb-Douglas production function. An IS-LM model of the Bulgarian economy is developed to study the condition of the different types of markets (labor market, goods market and money market). During the entire period 2010-2015 Bulgaria‘s output remained below its potential, while unemployment was above its natural level. The goods market and the money market were not balanced but fluctuated around their equilibrium levels. The conclusions of the study are in agreement with the Keynesian views about the disequilibrium character of the economic system and about the necessity of an expansionistic macroeconomic policy to stabilize the economy at its potential level in case of a deflationary gap (as in Bulgaria during 2010-2015).

JEL-codes: E32 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
https://www.ceeol.com/search/article-detail?id=608718

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:bas:econst:y:2017:i:5:p:30-64

Access Statistics for this article

More articles in Economic Studies journal from Bulgarian Academy of Sciences - Economic Research Institute Contact information at EDIRC.
Bibliographic data for series maintained by Diana Dimitrova ().