Author/Authors :
lakhchen, faical ibn zohr university - faculty of law, economics and social sciences of agadir, Agadir, Morocco , hachimi alaoui, hassan agadir ibn zohr university - faculty of law, economics and social sciences, Agadir, Morocco
Title Of Article :
AN ASSESSMENT OF THE STANDARD NEW KEYNESIAN MODEL APPLIED TO MOROCCO: A BAYESIAN ESTIMATION
Abstract :
In this paper, we criticize the use of the standard New Keynesian model in analyzing the Moroccan economy. By showing that, in addition to the well-known structural short comings of the model, it also fails to replicate the characteristics of the interest rate observed in data in the case of the Moroccan economy. In order to improve the performance of the model in replicating the characteristics of the interest rate, we moved from the standard model and we estimated two other variants. We found that the Taylor rule, as it stands in the standard model, doesn’t capture, wholly, the way that the monetary policy is conducted in Morocco. And a version of the Taylor rule that reacts also to the deviations of inflation and output from their values lagged by one period, improve the fit between the model and the data.
NaturalLanguageKeyword :
Standard New Keynesian model , Bayesian Estimation , persistence , interest rate , Taylor rule , replication
JournalTitle :
Revue Économie, Gestion Et Société
