This paper develops a model of the Chinese economy using a DSGE framework that accommodates a banking sector and money. The model is used to shed light on the period of the recent period of financial crisis. It differs from other applications in the use of indirect inference to estimate and test...

A common practice in estimating parameters in DSGE models is to nd a set that when simulated gets close to an average of certain data moments; the model s simulated performance for other moments is then compared to the data for these as an informal test of the model. We call this procedure...

A common practice in estimating parameters in DSGE models is to Önd a set that when simulated gets close to an average of certain data moments; the modelís simulated performance for other moments is then compared to the data for these as an informal test of the model. We call this procedure...

We set out Modern Monetary Theory (MMT) as a full DSGE model, and test it by indirect inference on post Financial Crisis US data, alongside a standard New Keynesian, NK, model. The MMT model is rejected, while the NK model has a high probability. We then evaluate replacing the Öscal and...

DSGE models based on New Keynesian principles, which have been extended to allow for banking, the zero lower bound on interest rates (ZLB), and varying price duration, can account well for recent macroeconomic behavior across a variety of economies. These models Önd that active Öscal policy...

Considerable micro-level evidence suggests that price/wage contract durations fluctuate with the state of the economy, particularly inflation; nonetheless, macro-level evidence for this is scarce. We incorporate state-dependent price/wage setting into an open economy DSGE model to investigate...