A basic New Keynesian DSGE model with dispersed information: An agent-based approach

Authored by Alessandro Gobbi, Jakob Grazzini

Date Published: 2019

DOI: 10.1016/j.jebo.2017.12.015

Sponsors: European Union

Platforms: No platforms listed

Model Documentation: Other Narrative Mathematical description

Model Code URLs: Model code not found

Abstract

The aim of this paper is to bridge macro agent-based models with mainstream macroeconomic models by agentifying the baseline New Keynesian DSGE model. The model features multiple, boundedly rational, optimizing agents and is analyzed through numerical simulations. We exploit the flexibility of agent-based modeling to explore the effect of dispersed information on the learning process and on macroeconomic outcomes. We find that with dispersed information monetary and fiscal policy acquire the role of public signals. (C) 2017 Elsevier B.V. All rights reserved.
Tags
Agent-based models Dynamics Computational Economics coordination Learning Heterogeneity Expectations Monetary-policy Dsge models Dispersed information