Financial Frictions in a Small Open Economy: DSGE Model of the Czech Economy with Time-Varying Parameters

• Authors: TVRZ Stanislav; VAŠÍČEK Osvald
• Year of publication: 2013
• MU Faculty or unit: Faculty of Economics and Administration
• Description: In this presentation, we study the changes in the structure and behaviour of a small open economy in a period of global recession and subsequent return to the long-run equilibrium. An example of the Czech real economy represented by nonlinear DSGE model with financial accelerator is employed to explore this problem. The model is estimated with the use of recursive Bayesian estimation and nonlinear particle filter.

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