An Annual Philippine Macroeconometric Model using Thirty-Six Equations Solved under a Dynamic Simultaneous System

Roberto  B. Raymundo,

An Annual Philippine Macroeconometric Model using Thirty-Six Equations Solved under a Dynamic Simultaneous System

Abstract:

Economic planners have adopted the use of mathematical models for the purpose of determining the short and medium term impact of various policy options on the economy. The effects of monetary, fiscal and foreign trade policies can be anticipated and its expected impact assessed as the models are simulated and economic aggregates forecasted. Any projections obtained can be compared with pre specified targets, and through this, adjustments can be undertaken in connection with the extent or degree of usage of either monetary, fiscal or foreign trade policy. Setting realistic prosimate and intermediate targets become possible once the magnitude of economic policy can be assessed and measured relative to its effects on all other economic aggregates.