Stock-Flow Consistent Macroeconomic Modeling Using EViews
The SFC modeling methodology is gaining consensus as an effective way of understanding the theoretical inter-relations between financial markets and real markets, and as a robust approach for developing empirical models for medium- and long-term policy analysis.
Empirical SFC models integrate consistently the statistics available from the non-financial and financial accounts of institutional sectors, allowing to track the dynamics of the different components of the balance sheet of each sector, and their impact for the behavior of household, firms, and financial institutions.
The course will alternate theoretical discussions with hands-on lab sessions using the EViews software.
By the end of the course the participants will have acquired detailed knowledge of and hands-on experience in:
- EViews
- Introduction to EViews
- Basic principles of SFC accounting
- The non-financial accounts of institutional sectors
- Flow-of-funds and balance sheets of institutional sectors
- The monetary circuit
- Money endogeneity, and the role of Central banks
- Open economy model
- Estimation or calibration of model parameters
- Building a model for policy simulations
The course uses a practical and very intensive approach to SFC macroeconomic modeling. The participants will actually build SFC models step-by-step with guidance from the instructor: from small to large scale and from simple to complex structure. The participants will acquire extensive practical hands-on experience in building a complex, realistic SFC model. This will allow them to implement the first version of their own SFC macro model using EViews codes and framework from the course.