Financial and fiscal shocks in the Great Recession and recovery of the Spanish economy
- José E. Boscá Mares 1
- Rafael Domenech 1
- Javier Ferri 1
- Rodolfo Méndez 1
- Juan F. Rubio Ramírez 2
- 1 Universidad de Valencia, España
- 2 Emory University, USA
ISSN: 1696-7496
Année de publication: 2018
Número: 5
Pages: 1-62
Type: Working Paper
D'autres publications dans: Documentos de trabajo ( FEDEA )
Résumé
In this paper we develop and estimate a new Bayesian DSGE model for the Spanish economy that has been designed to evaluate different structural reforms. The small open economy model incorporates a banking sector, consumers and entrepreneurs who accumulate debt, and a rich fiscal structure and monopolistic competition in products and labor markets, for a country in a currency union, with no independent monetary policy. The model can be used to evaluate ex-ante and ex-post policies and structural reforms and to decompose the evolution of macroeconomic aggregates according to different shocks. In particular, we estimate the contribution of financial and fiscal shocks to both the crisis of the Great Recession and the recovery of the Spanish economy.