Structural Differences and Asymmetric Shocks between the Czech Economy and the Euro Area 12

Warning

This publication doesn't include Faculty of Education. It includes Faculty of Economics and Administration. Official publication website can be found on muni.cz.

Authors	SLANICAY Martin
Year of publication	2011
Type	Article in Periodical
Magazine / Source	Národohospodářský obzor – Review of Economic Perspectives
MU Faculty or unit	Faculty of Economics and Administration
Citation
Field	Economy
Keywords	New Keynesian; DSGE model; Bayes factor; Bayesian estimation; structural differences; asymmetric shocks; model comparison
Description	The goal of this paper is to determine whether there exist asymmetric shocks and structural differences between the Czech economy and the Euro Area 12. A New Keynesian DSGE model of a small open economy is used for this purpose. Asymmetric shocks and structural differences are examined in two ways. Firstly, I examine asymmetry of shocks and sources of structural differences, using model comparison based on the Bayes factor. Secondly, I investigate impact of structural differences and differences in persistence and volatility of structural shocks on the behavior of both economies, using analysis of impulse-response functions.
Related projects:	Research Centre for the Competitiveness of the Czech Economy