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The EAGLE model for Hungary - a global perspective

Author

Listed:
  • László Békési

    (Magyar Nemzeti Bank (Central Bank of Hungary))

  • Lorant Kaszab

    (Magyar Nemzeti Bank (Central Bank of Hungary))

  • Szabolcs Szentmihályi

    (Magyar Nemzeti Bank (Central Bank of Hungary))

Abstract

In this paper we adopt the Hungarian version of the EAGLE (Euro Area GLobal Economy) model. The version of the EAGLE model used in this paper allows for the high import content of export a typical feature of small open economies such as Hungary. We study the effects of four globally important shocks on Hungary: i) a slowdown of the Chinese economy, ii) more restrictive US monetary policy, iii) a reduction in oil prices, and iv) more protectionist US trade policy. We found these policies to have non-negligible indirect e/ects (beyond the relatively small direct ones) on Hungary mostly due to the workings of the shock to the eurozone which is our main trade partner.

Suggested Citation

  • László Békési & Lorant Kaszab & Szabolcs Szentmihályi, 2017. "The EAGLE model for Hungary - a global perspective," MNB Working Papers 2017/7, Magyar Nemzeti Bank (Central Bank of Hungary).
    • Handle: RePEc:mnb:wpaper:2017/7
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    More about this item

    Keywords

    Multi-country DSGE; price and wage rigidity; EAGLE model; trade matrix; import content of export; local currency pricing; monetary policy shock; consumption preference shock; markup-shock.;
    All these keywords.

    JEL classification:

    • E12 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Keynes; Keynesian; Post-Keynesian; Modern Monetary Theory
    • E13 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Neoclassical
    • E52 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Monetary Policy
    • E58 - Macroeconomics and Monetary Economics - - Monetary Policy, Central Banking, and the Supply of Money and Credit - - - Central Banks and Their Policies
    • F11 - International Economics - - Trade - - - Neoclassical Models of Trade
    • F41 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Open Economy Macroeconomics

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