A Model of the Real Sector of Russian Economy with Several Goods and Agents-Traders

Sergey Vasilyev, Ivan Stankevich and Alexei Ujegov

HSE Economic Journal, 2018, vol. 22, issue 3, 362-386

Abstract: In this paper a real sector model of Russian economy is presented based on multiproduct decomposition of macroeconomic statistic. Model allows to reproduce statistic accurately in constant and current prices which is not possible in many other macroeconomic models. Model economy consists of agent-traders with the help of which GDP and its components are decomposed into unobservable products, agent-producer and agent-consumer. Traders are described by CES-functions. Analytical solution of trader problem gives ratios that are used for GDP decomposition. Producer has specific production function in which are considered two types of investments – investments that support fixed assets and investments that help to build up fixed assets. In addition, labor demand is described using an original scheme. Moreover, stock formation is described in producer model which is usually omitted in standard macroeconomic models. Aggregate consumer model reproduces optimal trajectories for consumption, labor and consumer deposits. Specific form of utility function gives opportunity to include labor as endogenous variable in the model which is not usually made in standard macroeconomic models. Considering economically active population and modifying calibration function it is possible to receive high accuracy in reproducing consumption, labor and deposits trajectories even in crisis periods. In this paper models are analytically solved and calibrated on real data without linearization procedure.

Keywords: Russian economy; GDP components by expenditure; decomposition; production; consumption; investment (search for similar items in EconPapers)
JEL-codes: C65 C68 (search for similar items in EconPapers)
Date: 2018
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