1 / 6

R ole and U sefulness of Models

R ole and U sefulness of Models. Role of Models. Models can be used as a tool. Models average past behavior. Models are consistent and systematic framework. A Model forecast is based on assumptions. Should be used with MPB’s judgement. Usefulness of Economic Models.

tangia
Download Presentation

R ole and U sefulness of Models

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Role and Usefulness of Models

  2. Role of Models • Models can be used as a tool. • Models average past behavior. • Models are consistent and systematic framework. • A Model forecast is based on assumptions. • Should be used with MPB’s judgement.

  3. Usefulness of Economic Models • Help in forecasting macroeconomic picture. • Assist in evaluating effects of policies and external factors on the economy.

  4. Models, Forecasts and Policy Core model Assumptions Other model MPB’s judgements Other issues andpolicy judgements Forecast Policy recommendation from the model Policy decision

  5. Financial Programming Framework Indicators Real Sector Block External Block Public Sector Block Financial Block Sectoral Model Macroeconomic Model Policy Conclusion Policy Questions Policy Simulation & Forecasting Core Model Output Forecasting Reaction Function Inflation Targeting Inflation Inflation Indicator Optimal Solution

  6. Model needs to be improved depending on: • New data become available. • The opportunity in developing and improving the model. • Changes in the economic and social environment. • New research findings in economics and new techniques in econometrics.

More Related