Adjustment dynamics and business cycle heterogeneity in the EMU: Evidence from estimated DSGE models

Konferenzbeitrag

The paper reviews adjustment dynamics in the EMU on the basis of estimated DSGE models for four large EA Member States (DE, FR, IT, ES). We compare the response of the four countries to identical shocks and find a particularly strong response of employment and wages in ES, a high sensitivity of IT to investment-related shocks, and a comparatively strong impact of global shocks on the DE economy. We also perform counterfactual exercises that apply the estimated shocks and parameters for ES to DE, FR, and IT. The counterfactual simulations suggest that differences in shocks have been important for GDP growth differentials, and together with structural differences also contributed to differences in employment fluctuations across the four countries considered.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: Beiträge zur Jahrestagung des Vereins für Socialpolitik 2019: 30 Jahre Mauerfall - Demokratie und Marktwirtschaft - Session: Open Economy Macroeconomics ; No. G03-V2

Classification and Topics

• Classification: Wirtschaft ; Business Fluctuations; Cycles ; Open Economy Macroeconomics ; International Business Cycles ; Macroeconomic Issues of Monetary Unions
• Subject: Estimated DSGE ; adjustment dynamics ; business cycles ; EMU ; counterfactuals

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Giovannini, Massimo ; Hohberger, Stefan ; Ratto, Marco ; Vogel, Lukas
• Event: Veröffentlichung
• (who): ZBW - Leibniz-Informationszentrum Wirtschaft
• (where): Kiel, Hamburg
• (when): 2019

Further information

• Handle: http://hdl.handle.net/10419/203548
• Last update: 10.03.2025, 11:44 AM CET