ABSTRACT
In this chapter we develop a prototype framework for the development of economic models for African countries. The prototype model is an equational framework intended to describe the structural characteristics and the behavior of major macro-economic agents and variables as simultaneously determined functional relationships among key economic variables, including policy-determined values. An economy is assumed to be small and open in the sense that activities and prices in the country are affected by conditions in world markets where its own influence is minimal. Furthermore, the country is assumed to be a price-taker for its exports of primary commodities. Although the prototype model given below includes specific institutional details of an economy, additional country-specific information is incorporated during the process of model development. The prototype model is used as the basis for the construction of the empirical models for selected African economies.
