Calibration for less developed economies

General DSGE Modeling
2

  1. Usually, there are three ways of setting parameters:

    1. Using micro-estimates.
    2. Doing informal moment-matching, e.g. based on the great ratios
    3. Formal estimation using either full or limited information techniques

    Option 2 often has the least data requirements

  2. I doubt that parameters are exactly the same for all economies, but priors differ on whether the difference between countries is the structural parameter values or the underlying structure of the economy

  3. Targeting the great ratios is a form of moment matching. Thus, you will usually match these very moments, but of course in general not the untargeted ones. I guess you were referring to those in your question.

  4. Even with moment matching there are usually unrestricted/untargeted moments you could check. Or sometimes there is outside evidence you can look at.