IDEAS home Printed from
   My bibliography  Save this paper

Macromodels of the Romanian transition Economy


  • Dobrescu, Emilian


The present book contains six chapters. In the first, the Romanian transition economy is characterized as a weakly structured economy (from the institutional point of view) with its main features: the poorly defined ownership rights, the limited effectiveness of new market mechanisms, the significant role of informal institutions, the behavioural instability of economic agents, the great influence of resources' allocation by the political factor. These features have many macroeconomic implications, of which three are especially analyzed: the waste of economic resources induced by the fuzzy ownership structure, by uncertainty and high transaction costs; the deep fracture between the real and nominal sectors; the presence of numerous economic activities not included in the official statistics (nonaccounted economy). The next chapter describes the main indicators used in the macromodel of the Romanian transition economy (definitions, symbols, specifications, relations among them, in accordance with the methodologies adopted by national statistics). The third chapter approaches the econometric problems. Unfortunately, the microeconomic foundations of the transition are not sufficiently studied and, in effect, in many cases we lack the necessary assumptions for building up econometric functions. On the other hand, the same statistical series are relatively short and are based on conventional simplifications imposed by the translation of the former methodologies (from material production system) to the language of the national accounts. Being weakly structured, the transition economy does not yet reveal consistent trends. Despite the unavoidable (under these conditions) instability of individual econometric functions, their integration into the macromodel, including the equilibrium constraints (accounting identities), can ensure acceptable results for short-run forecasts. Twenty econometric functions have been elaborated. They deal with: real output of the Romanian economy, domestic aggregate demand, investment,export, labour force, labour productivity, exchange rate, main deflators, labour incomes, households production for self-consumption, evolution of the nonaccounted economy, monetary processes. These functions reflect the peculiarities of the Romanian experience. It is possible that other transition economies may show similar tendencies, but eventual generalizations require supplementary researches. The fourth chapter is dedicated to the main version of the macromodel of the Romanian transition economy. Its tests for 1992 - 1995 (the 1994 - 1995 are presented herein), gave encouraging results. Consequently, it has been used for previsional estimations. Thus, in the fifth chapter, some possible scenarios of the evolution of the Romanian economy between 1996 - 2000 are examined. This analysis demonstrates that oniy a deep restructuring process is able to determine sound, long term sustainable, economic growth. Among the necessary policies I can mention: the realization of an ownership structure adequate to a modern market economy; the drastic limitation of inefficient economic activities subsidized by the state budget; the improvement of corporate governance; the progressive integration of Romania into the European and world economy; the effective functioning of different markets, including the capital one; maintenance of the inflation under control by a prudent monetary policy; lowering the share of the budget expenditures in GDP and the promotion, on this basis, of a rational fiscality. The last chapter examines an extended version of the macromodel, in which the general consolidated budget is explicitly presented. At the same time, other possible developments of the macromodel are outlined; its qualities and limits are mentioned. The most important problem remains the instability of the econometric functions. Consequently, it is necessary to reestimate them every year, taking into account new findings of the theory related to the transition and new statistical information. In other words, the macromodel must be permanently updated. In this way, a sort of sliding macroeconomic modelling is practiced. The appendices of the book contain a relevant set of macroeconomic indicators of Romania for the period 1980 -1995, the detailed presentation of the econometric functions and of the macroeconomic estimations, as well as a selective bibliography.

Suggested Citation

  • Dobrescu, Emilian, 1996. "Macromodels of the Romanian transition Economy," MPRA Paper 35810, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:35810

    Download full text from publisher

    File URL:
    File Function: original version
    Download Restriction: no

    References listed on IDEAS

    1. Eric V. Clifton & Mohsin S. Khan, 1993. "Interenterprise Arrears in Transforming Economies: The Case of Romania," IMF Staff Papers, Palgrave Macmillan, vol. 40(3), pages 680-696, September.
    2. Houston, Joel F., 1990. "The policy implications of the underground economy," Journal of Economics and Business, Elsevier, vol. 42(1), pages 27-37, February.
    3. van Eck, Robert & Kazemier, Brugt, 1988. "Features of the Hidden Economy in the Netherlands," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 34(3), pages 251-273, September.
    4. Drechsler, Laszlo & Horvath, Piroska, 1985. "Some Problems of the Measurement of Total Consumption in Hungary," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 31(2), pages 171-187, June.
    5. Fischer, Stanley & Merton, Robert C., 1984. "Macroeconomics and finance: The role of the stock market," Carnegie-Rochester Conference Series on Public Policy, Elsevier, vol. 21(1), pages 57-108, January.
    6. David Begg & Richard Portes, 1993. "Enterprise debt and economic transformation (Financial restructuring of the state sector in Central and Eastern Europe)," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 1(1), pages 116-117, January.
    7. Alston, Lee J., 1992. "Institutions, Institutional Change and Economic Performance : Douglass C. North, (Cambridge University Press, New York, 1990) pp. viii+152, hardcover $32.50, paper $10.95," Journal of Economic Behavior & Organization, Elsevier, vol. 18(1), pages 142-144, June.
    8. Albu, Lucian Liviu, 2007. "Underground Economy And Fiscal Policies Modeling," Working Papers of Institute for Economic Forecasting 071202, Institute for Economic Forecasting.
    9. Olivier Blanchard & Kenneth Froot & Jeffrey Sachs, 1994. "The Transition in Eastern Europe, Volume 2: Restructuring," NBER Books, National Bureau of Economic Research, Inc, number blan94-3, April.
    10. Olivier Jean Blanchard & Kenneth A. Froot & Jeffrey D. Sachs, 1994. "The Transition in Eastern Europe, Volume 1," NBER Books, National Bureau of Economic Research, Inc, number blan94-2, April.
    11. Ciupagea, Constantin, 1994. "An Elasticity Approach to the Analysis of Romanian Foreign Trade Policy during the Years of Transition," Economic Change and Restructuring, Springer, vol. 27(3), pages 227-250.
    12. Carlin, Wendy & Soskice, David, 1990. "Macroeconomics and the Wage Bargain: A Modern Approach to Employment, Inflation, and the Exchange Rate," OUP Catalogue, Oxford University Press, number 9780198772446.
    13. John R. Lott, 1992. "Institutions, institutional change and economic performance, by Douglass C. North. New York: Cambridge University Press, 1991, 152 pp. Price: $32.50 cloth, $10.95 paper," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 11(1), pages 156-159.
    14. Olivier Jean Blanchard & Kenneth A. Froot & Jeffrey D. Sachs, 1994. "Introduction to "The Transition in Eastern Europe, Volume 1"," NBER Chapters,in: The Transition in Eastern Europe, Volume 1, pages 1-18 National Bureau of Economic Research, Inc.
    15. Bonke, Jens, 1992. "Distribution of Economic Resources: Implications of Including Household Production," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 38(3), pages 281-293, September.
    16. Akiko Suwa, 1991. "Les modèles d'équilibre général calculable," Économie et Prévision, Programme National Persée, vol. 97(1), pages 69-76.
    Full references (including those not matched with items on IDEAS)

    More about this item


    model; econometric relationships; input-output analysis; simulations;

    JEL classification:

    • E0 - Macroeconomics and Monetary Economics - - General
    • C5 - Mathematical and Quantitative Methods - - Econometric Modeling


    Access and download statistics


    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pra:mprapa:35810. 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: (Joachim Winter). General contact details of provider: .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.