Imbalances and rebalancing scenarios in an estimated structural model for Spain
This paper uses an estimated DSGE model to analyse the factors behind the build-up of imbalances in the Spanish economy. Shock decompositions suggest that external imbalances have been able to build up mainly due to the reduction in real interest rates and easier access to credit following the elimination of the exchange rate risk premium. While the reduction in external imbalances has started in the recent period, projections of the estimated model indicate that faster correction to these imbalances will require an adjustment in domestic demand and a significant improvement in the trade balance in the coming years. The correction would be eased in a more favourable and less risk-averse environment.
|Date of creation:||Jul 2012|
|Date of revision:|
|Contact details of provider:|| Postal: |
Fax: +32 2 298.08.23
Web page: http://ec.europa.eu/economy_finance/index_en.htm
More information through EDIRC
When requesting a correction, please mention this item's handle: RePEc:euf:ecopap:0458. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (ECFIN INFO)
If references are entirely missing, you can add them using this form.