New tool in Stata revolutionizes economic policy analysis and forecasting!
Dynamic stochastic general equilibrium (DSGE) models are used in economics to analyze policies and predict outcomes. These models are based on equations from economic theory, some of which consider future expectations. The new dsge command in Stata helps estimate parameters in linear DSGE models. The researchers outline a typical DSGE model, estimate parameters, explain dsge output, and discuss postestimation features.