Title

A Small Macro-Econometric Model for Greece: Implications About the Sustainability of the Greek External Debt

Author First name, Last name, Institution

Dimitrios Asteriou
Dionysis Antonios Lalountas
Costas Siriopoulos

Document Type

Article

Source of Publication

SSRN Electronic Journal

Publication Date

1-1-2011

Abstract

This paper develops a small-scale macro-econometric model for Greece. The model will be used in order to examine the impact of macroeconomic policies on the real sector of the economy during the very difficult adjustment period that the Greek economy is currently facing. The model combines short-run Keynesian dynamics with a consistent neoclassical supply side. In this version potential output is given by a constant returns-to-scale Cobb-Douglas type production function. In most cases the short-run dynamics are modeled through an Error Correction Mechanism (ECM) which assumes the presence of adjustment costs in order to smooth-out the long-run equilibrium. A public sector side is also used in order to examine the impact of various shocks on public finance (specifically public debt).

ISSN

1556-5068

Publisher

Elsevier BV

Disciplines

Business

Indexed in Scopus

no

Open Access

no

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