A Study of a New-Keynesian DSGE Macro Model: Estimates, Shocks, and Optimal Monetary Policy
This paper estimates and simulates a New-Keynesian small-scale DSGE macro model. The model consists of the hybrid forms of the Phillips curve and the IS curve, and is closed with a Taylor-type feedback rule allowing partial adjustment of the monetary policy instrument. We estimate the three-equation system simultaneously on Swedish data 1995:Q1 to 2014:Q4 with the FIML estimator. The empirical par