Method to Simultaneously Determine Stock, Flow, and Parameter Values in Large Stock Flow Consistent Models
AbstractStock flow consistent macroeconomic models suffer from the lack of a coherent estimation method due to the complicated nature of the modeling process. This paper provides a candidate estimation method that determines the values of each stock and flow simultaneously by analytically solving any stock flow model, and converting the estimation into a global minimisation problem in p-k dimensions. We describe the method and apply it to a canonical model using real-world data. The method estimates the parameters and flows reliably.
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Bibliographic InfoPaper provided by Institute for New Economic Thinking (INET) in its series INET Research Notes with number 20.
Date of creation: 01 Jul 2012
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- Claudio H. Dos Santos & Gennaro Zezza, 2008. "A Simplified, 'Benchmark', Stock-Flow Consistent Post-Keynesian Growth Model," Metroeconomica, Wiley Blackwell, vol. 59(3), pages 441-478, 07.
- Soon Ryoo, 2009.
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UMASS Amherst Economics Working Papers
2009-03, University of Massachusetts Amherst, Department of Economics.
- Ryoo, Soon, 2010. "Long waves and short cycles in a model of endogenous financial fragility," Journal of Economic Behavior & Organization, Elsevier, vol. 74(3), pages 163-186, June.
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