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Comparative Properties of Models of the UK Economy

Published online by Cambridge University Press:  26 March 2020

K.B. Church ,
P.R. Mitchell ,
P.N. Smith  and
K.F. Wallis
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Abstract

This article analyses the properties of five major macroeconometric models of the UK economy in the light of the current debate over the setting of monetary and fiscal policy instruments. The broad objectives of current policy—sound public finances and low inflation—are reflected in a common operating environment for the models, with feedback rules for income tax and interest rates. Five standard simulation experiments demonstrate the consequences of these policy choices. The models disagree on several implications of this new policy framework, a critical parameter being the speed with which financial imbalances are rectified and inflation targets are met.

Type
Articles
Information
National Institute Economic Review , Volume 153 , August 1995 , pp. 59 - 72
Copyright
Copyright © 1995 National Institute of Economic and Social Research

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Footnotes

∗

This article continues the series of surveys published in the National Institute Economic Review by the ESRC Macroeconomic Modelling Bureau at the University of Warwick. Editorial responsibility is taken by the authors, not by the Editorial Board of the Review.

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