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Business Cycle Dynamics and Macroprudential Policy Through the Lens of the Aino Model - A Micro-Founded Small Open Economy DSGE Mo

Author

Listed:
  • Fabio Verona
  • Juha Kilponen
  • Seppo Orjasniemi
  • Antti Ripatti

Abstract

We specify a DSGE model for the small open economy of Finland and incorporate a monopolistic competitive banking sector in the spirit of Gerali, Neri, Sessa, and Signoretti (2010) for the purpose of analyzing various macroprudential issues within general equilibrium setup. We incorporate a monopolistic competitive banking sector in the spirit of Gerali, Neri, Sessa, and Signoretti (2010) in a small open economy setting similar to that in Christoffel, Coenen, and Warne (2008) and Adolfson, Laseen, Linde, and Villani (2005, 2007, 2008). We estimate it using Bayesian methods. //

Suggested Citation

  • Fabio Verona & Juha Kilponen & Seppo Orjasniemi & Antti Ripatti, 2015. "Business Cycle Dynamics and Macroprudential Policy Through the Lens of the Aino Model - A Micro-Founded Small Open Economy DSGE Mo," EcoMod2015 8441, EcoMod.
    • Handle: RePEc:ekd:008007:8441
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    References listed on IDEAS

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    6. Matteo Iacoviello, 2005. "House Prices, Borrowing Constraints, and Monetary Policy in the Business Cycle," American Economic Review, American Economic Association, vol. 95(3), pages 739-764, June.
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    8. F. Verona & M. M. F. Martins & I. Drumond, 2013. "(Un)anticipated Monetary Policy in a DSGE Model with a Shadow Banking System," International Journal of Central Banking, International Journal of Central Banking, vol. 9(3), pages 78-124, September.
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    Keywords

    Finland; Business cycles; Modeling: new developments;
    All these keywords.

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