A stochastic estimated version of the Italian dynamic General Equilibrium Model (IGEM)
Giovanni Di Bartolomeo (),
Fabio Di Dio (),
Marco Di Pietro (),
Francesco Felici and
No 3, Working Papers from Department of the Treasury, Ministry of the Economy and of Finance
We estimate with Bayesian techniques the Italian dynamic General Equilibrium Model (IGEM), which has been developed at the Italian Treasury Department, Ministry of Economy and Finance, to assess the effects of alter-native policy interventions. We analyze and discuss the estimated effects of various shocks on the Italian economy. Compared to the calibrated version used for policy analysis, we find a lower wage rigidity and higher adjustment costs. The degree of prices and wages indexation to past inflation is much smaller than the indexation level assumed in the calibrated model. No substantial difference is found in the estimated monetary parameters. Estimated fiscal multipliers are slightly smaller than those obtained from the calibrated version of the model.
Keywords: Dynamic General equilibrium model; Bayesian estimation; simulation analysis; Italy (search for similar items in EconPapers)
JEL-codes: E27 E30 E60 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-dge, nep-eec and nep-mac
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Persistent link: https://EconPapers.repec.org/RePEc:itt:wpaper:2018-3
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