Initial Testing of a Disequilibrium Adjustment Mechanism for CPE Macroeconometric Models.
SRI INTERNATIONAL ARLINGTON VA STRATEGIC STUDIES CENTER
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This report describes a disequilibrium adjustment mechanism for use in macroeconometric models of centrally planned economies. The mechanism is one that ensures that certain balances between supply and demand in specific sectors, or for specific factors, are adhered to in the models solution. Given in initial set of endogenously determined variable values, the search for balance is designed to minimize the deviation from these initial values, while at the same time satisfying the balancing constraints. Results of an initial test of the mechanism are also presented. Author
- Economics and Cost Analysis
- Statistics and Probability