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XMAS: An extended model for analysis and simulations

Author

Listed:
  • Benjamín García
  • Sebastián Guarda
  • Markus Kirchner
  • Rodrigo Tranamil

Abstract

The Extended Model for Analysis and Simulations (XMAS) is the Central Bank of Chile's newest dynamic stochastic general equilibrium (DSGE) model for macroeconomic projections and monetary policy analysis. Building on Medina and Soto (2007), the model includes several new features, in line with recent developments in the modeling of small open economies, particularly commodityexporting emerging economies such as Chile. The extensions over the base model include the modeling of non-core inflation dynamics, a commodity sector with endogenous production and investment, a labor market with search and matching frictions that allows for labor variation on both the intensive and extensive margins, an augmented fiscal block, as well as additional shocks and other real and nominal frictions. These features allow for a more granular analysis and more comprehensive forecasts of the Chilean economy, improving the fit of the model to macroeconomic data in several dimensions.

Suggested Citation

  • Benjamín García & Sebastián Guarda & Markus Kirchner & Rodrigo Tranamil, 2019. "XMAS: An extended model for analysis and simulations," Working Papers Central Bank of Chile 833, Central Bank of Chile.
    • Handle: RePEc:chb:bcchwp:833
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    Cited by:

    1. Heresi, Rodrigo, 2023. "From Macroeconomic Stability to Welfare: Optimizing Fiscal Rules in Commodity-Dependent Economies," IDB Publications (Working Papers) 13141, Inter-American Development Bank.
    2. Benjamín García & Mario González & Sebastián Guarda & Manuel Paillacar, 2022. "Unconventional credit policies during crises: A structural analysis of the Chilean experience during the COVID-19 pandemic," Working Papers Central Bank of Chile 954, Central Bank of Chile.
    3. Medina, Juan Pablo & Toni, Emiliano & Valdes, Rodrigo, 2023. "The Art and Science of Monetary and Fiscal Policies in Chile," MPRA Paper 117198, University Library of Munich, Germany, revised 28 Apr 2023.
    4. Gent Bajraj & Andrés Fernández & Miguel Fuentes & Benjamín García & Jorge Lorca & Manuel Paillacar & Juan Marcos Wlasiuk, 2022. "Global Drivers and Macroeconomic Volatility in EMEs: a Dynamic Factor, General Equilibrium Perspective," Working Papers Central Bank of Chile 963, Central Bank of Chile.
    5. Fornero, Jorge & Kirchner, Markus & Molina, Carlos, 2024. "Estimating shadow policy rates in a small open economy and the role of foreign factors," Journal of International Money and Finance, Elsevier, vol. 140(C).
    6. Mauricio Calani & Benjamín García & Tomás Gómez & Mario González & Sebastián Guarda & Manuel Paillacar, 2022. "A Macro Financial Model for the Chilean Economy," Working Papers Central Bank of Chile 953, Central Bank of Chile.
    7. Martínez, J-F. & Peiris, M.U. & Tsomocos, D.P., 2020. "Macroprudential policy analysis in an estimated DSGE model with a heterogeneous banking system: An application to Chile," Latin American Journal of Central Banking (previously Monetaria), Elsevier, vol. 1(1).
    8. Hevia, Constantino & Macera, Manuel & Neumeyer, Pablo Andrés, 2022. "Covid-19 in unequal societies," Journal of Economic Dynamics and Control, Elsevier, vol. 140(C).
    9. Arroyo Marioli, Francisco & Becerra, Juan Sebastián & Solorza, Matías, 2022. "The credit channel in chile through the lens of a semi-structural model," Latin American Journal of Central Banking (previously Monetaria), Elsevier, vol. 3(2).

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