The Italian block of the ESCB multi-country model

Arbeitspapier

This paper documents the structure, estimation and simulation properties of the Italian block of the ESCB-multi-country model (MCM). The model is used regularly as an input into Eurosystem projection exercises and, to a lesser extent, in simulation analysis. The specification of the Italian model follows closely that of the Area-Wide Model (AWM) and indeed the other MCM country blocks (in terms of specification and accounting framework). The MCM is a quarterly estimated structural macroeconomic model that treats the economy in a relatively closed manner. It has a long-run classical equilibrium with a vertical Phillips curve but with some short-run frictions in price/wage setting and factor demands. Consequently, activity is demand-determined in the short-run but supply-determined in the longer run with employment having converged to a level consistent with an exogenously given level of equilibrium unemployment. The precise properties of the model are illustrated using a number of standard variant simulations.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: ECB Working Paper ; No. 660

Classification and Topics

• Classification: Wirtschaft
• Subject: Italy ; Macro-econometric Modelling ; Makroökonometrie ; Wirtschaftsprognose ; Simulation ; Zentralbank ; EU-Staaten ; Italien

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Angelini, Elena ; D’Agostino, Antonello ; McAdam, Peter
• Event: Veröffentlichung
• (who): European Central Bank (ECB)
• (where): Frankfurt a. M.
• (when): 2006

Further information

• Handle: http://hdl.handle.net/10419/153094
• Last update: 2025-03-10T11:45:03+0100