Palma, Pedro A., Fontiveros, Domingo A comparative sensitivity analysis of the MODVEN VII macroeconomic model for Venezuela. Economic Modelling, Vol. 5, Number 4, October 1988. Pp. 286-346.
In the first section of the paper the authors present the structure and main features
of the macroeconometric model for Venezuela, MODVEN VII, specifying the blocks
of equations and their most relevant characteristics. The second part of the paper
contains a sensitivity analysis of the model. That was done by analysing the results
of eight alternative economic policy simulations, which were also compared with the
results of similar exercises made with econometric models of seven other countries.
These simulations served as the basis for analysis at the Conference on Performance
of Econometric Models of NICs and Developing Countries, held in Taipei, Taiwan
in May 1987. As a result of this comparison some conclusions are drawn about the
model’s sensitivity to different economic policy shocks. In this comparative analysis
special emphasis is laid on the behaviour and performance of the Venezuelan model.
Finally, changes in the specifications of some equations are introduced in the model
in order to improve its response capacity. The eight simulations were rerun with the
modified model and the results were compared with those of the original exercises. Some
suggestions about future improvements of the model are presented in the conclusions
of the paper. A detailed list of the equations of the model and the description of its
variables are included in an appendix.
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