Hi Prof. Pfeifer and to all,
Is it possible to get dynare to compute IRFs to 1% shock? I could find options only for 1sd and relative IRFs based on 1sd shock.
Thank you,
Leonid.
The relative_irf option usually provides you with a way to do this (see the manual). Or is there anything special in your application that makes this option inapplicable?
Thank you, Professor Pfeifer.
I have another question.
I want to measure the fiscal multiplier
(the impact of a 1% of GDP (Y) increase in government consumption G to increase GDP) for the log-linearized model (the IRFs are in percent).
I think that the fiscal multiplier is equal to (delta_Y/delta_G) or (delta_Y/delta_G)*G/Y?
So which explanation is right?
Thank you,
Leonid
That depends on your setup. If delta_G is measured in percent of G, then you need the scaling with the G/Y-ratio to get the multiplier in output units. If delta_G is measured in percent of Y, then no more scaling is needed.