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Modelo de Ciclos Reales para Colombia
[A real business cycle model for Colombia]

Author

Listed:
  • Prada Sarmiento, Juan David

Abstract

Colombian economy has the typical small-open economy cycle: smooth consumption, higher volatility in investment ; procyclical consumption, investment and imports; countercyclical trade balance. The objective of this paper is to identify the stylized facts and to replicate them quantitative and qualitatively through a simple dynamic stochastic general equilibrium model calibrated for Colombia. The model is used to assess the response of the economy to exogenous shocks in productivity, interest rates and fiscal policy. The standard RBC model is a good tool to replicate the stylized facts found for Colombia. However, it cannot replicate some facts about labour market, and underestimates the volatility of consumption and the relative volatility of investment with respect to GDP.

Suggested Citation

  • Prada Sarmiento, Juan David, 2005. "Modelo de Ciclos Reales para Colombia [A real business cycle model for Colombia]," MPRA Paper 16286, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:16286
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    References listed on IDEAS

    as
    1. Schmitt-Grohe, Stephanie & Uribe, Martin, 2003. "Closing small open economy models," Journal of International Economics, Elsevier, vol. 61(1), pages 163-185, October.
    2. Hansen, Gary D., 1985. "Indivisible labor and the business cycle," Journal of Monetary Economics, Elsevier, vol. 16(3), pages 309-327, November.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Small open economy; real business cycle; Colombia;
    All these keywords.

    JEL classification:

    • E32 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Business Fluctuations; Cycles
    • E30 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - General (includes Measurement and Data)
    • E13 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Neoclassical

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