A New Keynesian Model of the Armenian Economy

Ara Stepanyan, Era Dabla-Norris and Ashot Mkrtchyan

No 2009/066, IMF Working Papers from International Monetary Fund

Abstract: This paper develops a small open economy dynamic stochastic general equilibrium (DSGE) model of the Armenian economy. The structure of the model is largely motivated by recent developments in DSGE modeling, with key extensions to incorporate specific structural characteristics of the Armenian economy. The resultant model can be used to simulate monetary policy paths and help analyze the robustness of policy conclusions. The paper tests the model’s properties on Armenian data, demonstrating that the main stylized features relevant for monetary policy making are well captured by the model.

Keywords: WP; interest rate; business cycle; price level; Inflation Targeting; Monetary Transmission Mechanism; Macroeconomic Models; Armenia; home goods inflation equation; output-inflation tradeoff; exchange rate appreciation; open economy; goods price; Real exchange rates; Inflation; Consumption; Exchange rates; Real interest rates; Global (search for similar items in EconPapers)
Pages: 43
Date: 2009-03-01
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Citations: View citations in EconPapers (10)

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