IDEAS home Printed from https://ideas.repec.org/a/rfa/aefjnl/v12y2025i2p29-50.html
   My bibliography  Save this article

DSGE Models: Practical Methodological Note and Recent Trends

Author

Listed:
  • Alfranio Rodrigo Trescher
  • Mathias Schneid Tessmann

Abstract

This methodological note aims to present a brief yet comprehensive step-by-step guide for estimating Dynamic Stochastic General Equilibrium (DSGE) models and its recent trends. The first chapter introduces DSGE models to achieve this, discussing their theoretical foundations, historical evolution, and main applications. The second chapter explores the relationship between DSGE models and semi-structural models, highlighting their differences and complementarities in macroeconomic analysis. The third chapter presents the theoretical foundations for constructing these models, detailing the behavior of economic agents, general equilibrium mechanisms, and the modeling of stochastic shocks. The fourth chapter provides examples of the application of DSGE models in monetary and fiscal policy, analyzing the influence of different economic policy rules on macroeconomic behavior. Finally, the fifth chapter outlines the limitations of using DSGE models, including theoretical criticisms, difficulties in modeling economic crises, and challenges in parameter estimation. Thus, we aim to contribute to researchers, market professionals, and students who intend to use these models in their work.

Suggested Citation

  • Alfranio Rodrigo Trescher & Mathias Schneid Tessmann, 2025. "DSGE Models: Practical Methodological Note and Recent Trends," Applied Economics and Finance, Redfame publishing, vol. 12(2), pages 29-50, May.
    • Handle: RePEc:rfa:aefjnl:v:12:y:2025:i:2:p:29-50
    as

    Download full text from publisher

    File URL: https://redfame.com/journal/index.php/aef/article/download/7668/6876
    Download Restriction: no
    File URL: https://redfame.com/journal/index.php/aef/article/view/7668
    Download Restriction: no
    ---><---

    More about this item

    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:rfa:aefjnl:v:12:y:2025:i:2:p:29-50. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Redfame publishing (email available below). General contact details of provider: https://edirc.repec.org/data/cepflch.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.