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Year of Publication: 
Series/Report no.: 
Development Research Working Paper Series No. 07/2018
Institute for Advanced Development Studies (INESAD), La Paz
Abstract (Translated): 
The objective of this paper is to evaluate the cyclical behavior of the Bolivian economy based on a Markov-Switching Dynamic General Equilibrium model (MS-DSGE). Using a model for a small open economy, with monetary targeting and foreign-exchange intervention, results of Bayesian estimation provide evidence that some structural parameters of the model, such as the coefficients of the Central Bank's reaction function, experienced a change of regime in 2000-2017. A similar behavior could also be verified for the volatilities of the structural shocks experienced by the Bolivian economy in that period.
Economic fluctuations
DSGE Model
Markov Switching
Bayesian Estimation
Document Type: 
Working Paper

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