Comparative Dynamics with Fiscal Dominance. Empirical Evidence from Argentina 2016-2019

Serie Documentos de Trabajo - Nro. 723

39 Pages Posted: 13 Jul 2020

Date Written: April 2020

Abstract


A DSGE (Dynamic Stochastic General Equilibrium) model is used to report the empirical behavior of the Argentine economy during the administration of the Cambiemos government coalition. Two main aspects have been taken into account: on the one hand, the debate on the economic policy of the 2016-2019 period, and on the other hand the requirement of microeconomic foundations that support the debate and the empirical results. Two alternative macro models are estimated obtaining statistically significant parameters to illuminate confusing aspects of the policy debate, and to help future research on modeling Argentina macro dynamics. The empirical results obtained for Argentina indicate that the small open economy models used in the state-space specification can also be useful for modeling other small open economies that suffer from Fiscal Dominance.

Suggested Citation

Fernandez, Roque Benjamin, Comparative Dynamics with Fiscal Dominance. Empirical Evidence from Argentina 2016-2019 (April 2020). Serie Documentos de Trabajo - Nro. 723, Available at SSRN: https://ssrn.com/abstract=3631220 or http://dx.doi.org/10.2139/ssrn.3631220

Roque Benjamin Fernandez (Contact Author)

Universidad del CEMA ( email )

1054 Buenos Aires
Argentina

HOME PAGE: http://www.cema.edu.ar/u/rbf/

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