Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/249357 
Year of Publication: 
2020
Series/Report no.: 
JRC Working Papers in Economics and Finance No. 2020/5
Publisher: 
Publications Office of the European Union, Luxembourg
Abstract: 
Estimated DSGE models tend to ascribe a significant and often predominant part of a country's trade balance (TB) dynamics to domestic drivers ("shocks"), suggesting foreign factors to be only of secondary importance. This paper revisits the result based on more agnostic approaches to shock transmission and using "agnostic structural disturbances". We estimate multi-region models for Germany and Spain as countries with very distinct TB patterns since 1999. Results suggest that domestic drivers remain dominant when theory-based restrictions on shock transmission are relaxed, although the transmission of foreign shocks is strengthened.
Subjects: 
Agnostic structural disturbances
open economy DSGE model
trade balance
Germany
Spain
JEL: 
F30
F32
F41
F45
Persistent Identifier of the first edition: 
ISBN: 
978-92-76-19936-6
Creative Commons License: 
cc-by Logo
Document Type: 
Working Paper

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