Scenarios of economic development in Romania - medium to long-term forecasting models

In order to obtain plausible scenarios of economic development in Romania up to the 2015 horizon, we used a mix of forecasting models, from ones classified as “medium-term” to those covering longer forecasting periods. Based on the analysis of the economic transition period we mainly used three models: a) A sustainability function model (public debt and fiscal deficits); b) A simple econometric model, based on a production function, in which FDI and exports are introduced as inputs in addition to labour and domestic capital (also developed as a quarterly model); c) A standard Cobb-Douglas model (also used in the case of the main economic sectors). In this paper we are synthetically presenting the basic equations of the models, and also their main simulation outputs.