Simulating a Simple Real Business Cycle Model Using Excel
Simulating the real business cycle models is a popular topic in first-year graduate courses on macroeconomics. Usually, Maple and Matlab are used for this purpose, mainly because they can be used both for solving and for simulating the models. Strulik (2004) demonstrates that Excel can be used both for solving and for simulating a standard RBC model. In this paper, we propose a more elementary approach that might be suitable for undergraduate courses. We illustrate (i) how to solve a simple RBC model by hand and (ii) how to use Excel to simulate the solution.
Volume (Year): 19 (2007)
Issue (Month): 1 ()
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- Kydland, Finn E & Prescott, Edward C, 1982.
"Time to Build and Aggregate Fluctuations,"
Econometric Society, vol. 50(6), pages 1345-70, November.
- Finn E. Kydland & Edward C. Prescott, 1982. "Web interface for "Time to Build and Aggregate Fluctuations"," QM&RBC Codes 4a, Quantitative Macroeconomics & Real Business Cycles.
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- Holger Strulik, 2004. "Solving Rational Expectations Models Using Excel," The Journal of Economic Education, Taylor & Francis Journals, vol. 35(3), pages 269-283, July.
- Roger E. A. Farmer, 1999. "Macroeconomics of Self-fulfilling Prophecies, 2nd Edition," MIT Press Books, The MIT Press, edition 2, volume 1, number 0262062038, June.
- Long, John B, Jr & Plosser, Charles I, 1983. "Real Business Cycles," Journal of Political Economy, University of Chicago Press, vol. 91(1), pages 39-69, February.
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