A stock-flow model for Argentina

Gabriel Michelena has published a new model for Argentina (in Spanish).
Available here: http://www.bcra.gov.ar/PublicacionesEstadisticas/Resumen.asp?id=1519&prevPage=2

Resumen
El presente documento desarrolla un modelo de Stock-Flujo Consistente (SFC)
para el análisis de las variables macroeconómicas de la Argentina. La principal
utilidad de los modelos SFC está asociada a la posibilidad de realizar
ejercicios contrafactuales para evaluar diferentes modificaciones de la política
fiscal, tributaria, monetaria y comercial. Estos modelos están caracterizados
por la utilización de matrices de contabilidad social (SAM), lo que permite
realizar una desagregación de la cuenta capital y de los instrumentos financieros
de cada sector institucional. Esto le otorga consistencia contable, ya que la
SAM contiene las principales transacciones del sector real, así como los flujos
monetarios entre las distintas instituciones: hogares, empresas, bancos, gobierno,
banco central y el resto del mundo. Este modelo fue elaborado con el objetivo de
realizar proyecciones de mediano plazo sobre los principales flujos y stocks de la
economía argentina, complementando los resultados de otros modelos existentes
en la literatura.

A Post-Keynesian stock-flow consistent model of the Global Financial Crisis and the Age of Secular Stagnation

Adam Kaczynski has recently completed his PhD with a thesis on “A Post-Keynesian stock-flow consistent model of the Global Financial Crisis and the Age of Secular Stagnation”.
The PDF is available here, and the corresponding code can be downloaded from Github.

Abstract:
This thesis is an attempt to build a dynamic, long run, Stock-Flow Consistent, Post Keynesian model of the Global Financial Crisis and Secular Stagnation. While multiple New Keynesian Dynamic Stochastic General Equilibrium models of these historic phenomena already exist, these models are built on theoretical foundations which have been rejected by Post Keynesians because of their inadequacy. The Sraffian Supermultiplier has been chosen as the theoretical framework, isolating parts of the economy generating instability from the parts which may set the trend in the long run. The model uses a continuous-time framework and is expressed as a differential-algebraic system of equations. It is simulated using an Open Source package OpenModelica which is widely used in empirical and technical sciences for simulating dynamic systems. While not calibrated by regression, and more theoretical than econometric, it nevertheless reproduces multiple macroeconomic phenomena and stylised facts which have puzzled mainstream economists. This research is an attempt to advance the macroeconomic modelling methodology and contribute to understanding macroeconomic processes by demonstrating how complex phenomena can emerge when simple parts of the economy interact. The understanding is based on sound macroeconomic theories built by Marx, Keynes, Kalecki, Sraffa and contemporary Post Keynesian economists.

SFC models in Python

Here is a letter from Kenn Tamara, who developed the models in Godley-Lavoie using Python:

I was reading “Monetary Economics” by Godley and Lavoie and came across the sfc-models.net website. I have taken your eViews models and reimplemented them using Python (running the experiments and generating the figures).

Everything is open-source and is written with a package that I developed to help specify and solve the models. The models are implemented as iPython notebooks for easier viewing and can be found at:
https://github.com/kennt/monetary-economics

Information on the pysolve package used to specify and solve the models can be found at:
https://github.com/kennt/pylinsolve

(A little warning, the code for pysolve is still under development and there isn’t that much documentation yet)

I hope that the python implementation is useful and would like to contribute it to sfc-models.net.

Thank you,
Kenn Takara

Interactive SFC models

I recently discovered that Kevin W. Capehart has written a piece of code in Mathematica from one of my Eviews files for the Godley – Lavoie Monetary economics book, and turned it into a CDF, to illustrate the paradox of thrift

To run the simulation you need to install the free Wolfram reader, and activate it.

This little tool is potentially very useful in exploring stock-flow models, which are tipically non linear, and therefore difficult to solve analitically. Creating a nice interface which allows the user to check model responses to different values of parameters and exogenous variables could help find the range of parameter values for which the model is producing stable (or unstable etc) solutions.

From Gabor Kurthy

Received from Gabor Kurthy (Corvinus University, Budapest)

“I’d like to contribute to the sfc-models.net page by sending the solution of model REG (pp.: 170-186).

In the PDF file you will find the solution of the model. If you are interested, I can send you a more detailed paper that contains the steps of the solution and some analysis as well (I haven’t translated that paper yet).

In the Excel file you will find the model: I wrote three macros to
(1) compute different steady states by changing the parameter set (policy variables included)
(2) see the evolution from state zero to the steady state (parameters and policy variables can be changed)
(3) see the effects of different shocks after changing the parameters or the policy variables.

I hope that you will find it useful.”

Stock-flow lab at the Minsky Summer Seminar

The stock-flow lab at the Minsky Summer School was a success, according to my personal view…
Some students asked me to make materials availble on the web, since we did not use the readily available programs I had previously published, and I have therefore created a Walk-trough for what we did during the three days.
Students attending were great, keeping their attention to the last minute of the lab, even after a long working day.

Files available: