An Estimation of Output Gap in Romanian Economy Using the DSGE Approach

Petre Caraiani

Prague Economic Papers, 2009, vol. 2009, issue 4, 366-379

Abstract: In this paper I use an open economy DSGE model and estimate it for Romanian economy using Bayesian techniques. Based on estimation I derive a smoothed estimation of the output gap. I compare the results with those from standard procedures to estimate the output gap, the Hodrick Prescott ilter, the production function and an unobserved components model. The results show that the DSGE approach can give a better picture of the output gap and it is more consistent with the dynamics of Romanian economy.

Keywords: monetary policy; output gap; DSGE models; Bayesian techniques (search for similar items in EconPapers)
JEL-codes: C51 E32 E52 (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (1)

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DOI: 10.18267/j.pep.360

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