ABSTRACT
Economic models play an important role within the Troika process. This section presents various types of models used by the Troika and discusses some examples of how they are used.
Large-scale macroeconometric models Large-scale macroeconometric models are used in several different ways in the Troika process. Such models typically are used to produce the detailed macroeconomic forecast for the budget (as described above) or to examine behavioral responses to specific policies or shocks. Historically, the CEA, Treasury and OMB have subscribed to a variety of commercial macroeconomic forecasts and models. The agencies subscribe to these models rather than face the higher resource cost of estimating and maintaining an in-house large-scale macroeconometric model.12
