The Effects of Macroeconomic Shocks in a Basic Equilibrium Framework

Enrique Mendoza

IMF Staff Papers, 1992, vol. 39, issue 4, 855-889

Abstract: The macroeconomic effects of random shocks to output, the terms of trade, and the real interest rate are examined using an intertemporal equilibrium model of a small open, endowment economy. Equilibrium stochastic processes are computed numerically and compared with actual stylized facts. The model rationalizes the Harberger-Laursen-Metzler effect, but cannot produce countercyclical net exports and large real exchange rate fluctuations. The quantitative implications of the model are compared with the implications of the elasticities approach, and their sensitivity to changes in preference parameters and in the persistence of shocks is examined.

JEL-codes: E32 N1 (search for similar items in EconPapers)
Date: 1992
References: Add references at CitEc
Citations: View citations in EconPapers (36)

Downloads: (external link)
http://www.jstor.org/stable/3867424?origin=pubexport main text (application/pdf)
Access to full text is restricted to subscribers.

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:pal:imfstp:v:39:y:1992:i:4:p:855-889

Ordering information: This journal article can be ordered from
http://www.springer. ... cs/journal/41308/PS2

Access Statistics for this article

More articles in IMF Staff Papers from Palgrave Macmillan
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().