The banking and distribution sectors in a small open economy DSGE Model

Szabolcs Deak, Lionel Fontagné, Marco Maffezzoli () and Massimiliano Marcellino

No 2012/53, RSCAS Working Papers from European University Institute

Abstract: The recent crisis has emphasized the role of financial - macroeconomic interactions, and international trade in goods and services, in the transmission of the shocks. Both phenomena, closely related to the higher degree of globalization, are very relevant for small open economies, and particularly so when a large share of the economy relies on financial and distribution services. Hence, in this paper we propose to incorporate the banking and distribution sectors into a medium scale DSGE model of a small open economy. As an illustration, the resulting model is then calibrated to match the specific characteristics of the Luxembourg economy, where the financial sector plays a key role. We believe that the results are also of more general interest for studying the reaction of small open economies to real and financial shocks.

Date: 2012-09-12
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
http://cadmus.eui.eu/bitstream/handle/1814/23915/RSCAS_2012_53.pdf?sequence=1 (application/pdf)
http://hdl.handle.net/1814/23915

Related works:
Working Paper: The banking and distribution sectors in a small open economy DSGE Model (2012)
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:rsc:rsceui:2012/53

Access Statistics for this paper

More papers in RSCAS Working Papers from European University Institute Convento, Via delle Fontanelle, 19, 50014 San Domenico di Fiesole (FI) Italy. Contact information at EDIRC.
Bibliographic data for series maintained by RSCAS web unit ().