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Empirical Macroeconomic Model of the Finnish Economy (EMMA)

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  • Markku Lehmus

Abstract

This paper provides a review of the empirical macroeconomic model (EMMA) built for forecasting purposes at the Finnish Labour Institute for Economic Research. The model is quite small, consisting of 71 endogenous and 70 exogenous variables. The number of behavioural equations is 15. The basis of the model is Keynesian, although the model has so me novel properties. They are the treatment of the supply side and prices that follow the routes of the neoclassical synthesis. The parameters of the model are estimated from qu arterly data that cover the years 1990-2005. The model also contains a Kalman-filtered variable to control the deep recession in Finland at the beginning of the ’90s. This special feature brings the model closer to the new calibrated models.

Suggested Citation

  • Markku Lehmus, 2007. "Empirical Macroeconomic Model of the Finnish Economy (EMMA)," Working Papers 225, Työn ja talouden tutkimus LABORE, The Labour Institute for Economic Research LABORE.
    • Handle: RePEc:pst:wpaper:225
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    References listed on IDEAS

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    Cited by:

    1. Lehmus, Markku, 2018. "ETLA macro model for forecasting and policy simulations," Economic Modelling, Elsevier, vol. 74(C), pages 142-166.
    2. Suni, Paavo & Vihriälä, Vesa, 2016. "Finland and Its Northern Peers in the Great Recession," ETLA Reports 49, The Research Institute of the Finnish Economy.
    3. Markku Lehmus, 2009. "Labour Taxation and Employment: An Analysis with a Macroeconomic Model for the Finnish Economy," Working Papers 249, Työn ja talouden tutkimus LABORE, The Labour Institute for Economic Research LABORE.
    4. Lehmus, Markku, 2011. "Labor or consumption taxes? An application with a dynamic general equilibrium model with heterogeneous agents," Economic Modelling, Elsevier, vol. 28(4), pages 1984-1992, July.
    5. Fornaro, Paolo & Luomaranta, Henri, 2018. "Aggregate fluctuations and the effect of large corporations: Evidence from Finnish monthly data," Economic Modelling, Elsevier, vol. 70(C), pages 245-258.

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