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Comparing Empirical Models of the Euro Economy

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  • Kenneth F. Wallis

Abstract

This article presents a comparative analysis of four macroeconometric models whose proprietors participated in a model comparison conference focused on the new euro area economy. One model, the Area-Wide Model recently developed at the European Central Bank, treats the whole area as a single economy. The other three, MULTIMOD, NIGEM and QUEST, are established multicountry models that provide disaggregated analysis of questions of economic policy in Europe. Their structural characteristics and the results of two policy simulations are compared and contrasted. The principal source of simulation differences is the different degree of forward-looking behaviour incorporated in the models.

Suggested Citation

  • Kenneth F. Wallis, 2004. "Comparing Empirical Models of the Euro Economy," Econometric Society 2004 Australasian Meetings 14, Econometric Society.
    • Handle: RePEc:ecm:ausm04:14
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    More about this item

    Keywords

    Macroeconometric models; Multicountry models; Model comparisons; Simulation; Euro-area economy;
    All these keywords.

    JEL classification:

    • C5 - Mathematical and Quantitative Methods - - Econometric Modeling
    • E1 - Macroeconomics and Monetary Economics - - General Aggregative Models

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