A Stock-Flow Consistent Model of the Icelandic Economy, 2004–2021

International audience In this paper, we provide a Stock-Flow Consistent model of the Icelandic economy that is used both to replicate stylized facts and to carry out macroeconomic forecasts. We show that the key drivers of the domestic macroeconomic dynamic are growth of the Eurozone, exchange rate...

Full description

Bibliographic Details
Main Author: Malherbe, Léo
Other Authors: Centre de Recherche sur les Institutions, l'Industrie et les Systèmes Économiques d'Amiens - UR UPJV 3908 (CRIISEA), Université de Picardie Jules Verne (UPJV)
Format: Article in Journal/Newspaper
Language:English
Published: HAL CCSD 2022
Subjects:
SFC
Iceland
Crises
Forecast
[SHS.ECO]Humanities and Social Sciences/Economics and Finance
Krona
Online Access:https://hal-u-picardie.archives-ouvertes.fr/hal-04086060
https://doi.org/10.48611/isbn.978-2-406-12814-4.p.0115
Description
Summary:International audience In this paper, we provide a Stock-Flow Consistent model of the Icelandic economy that is used both to replicate stylized facts and to carry out macroeconomic forecasts. We show that the key drivers of the domestic macroeconomic dynamic are growth of the Eurozone, exchange rate with the euro, Central Bank of Iceland key interest rate and entrepreneurs' confidence. The model is shocked in order to reproduce the COVID-19 crisis in the Eurozone and the effects on the Icelandic economy are analyzed. We finally discuss how deficit spending and depreciation of the Icelandic krona might limit the recessive effects.

Similar Items