Investigating the impact of an appreciation of the euro in a small macroeconometric model of Germany and the euro area

Carsten-Patrick Meier

No 1204, Kiel Working Papers from Kiel Institute for the World Economy (IfW Kiel)

Abstract: Since the start of European monetary union, the macroeconomic situation in Germany can in many respects only be analyzed in combination with the situation in the rest of the euro area. To take this into account, a small macroeconometric model is constructed that models the euro area as consisting of two regions, Germany and the rest of the euro area. The rest of the world is treated as exogenous. Given problems with modelling the relevant relationships in a standard vector autoregression approach, the model is set up as a dynamic simultaneous equations model. The model is used to study the impact of monetary policy or of exchange rate changes on economic activity in Germany and the euro area.

Keywords: Macroeconometric model for Germany; euro area; appreciation (search for similar items in EconPapers)
JEL-codes: E17 F47 (search for similar items in EconPapers)
Date: 2004
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:zbw:ifwkwp:1204

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