This note estimates several constrained versions of an optimization-based multi-country model to test the sources of heterogeneity within the euro area. We show that the main source is the asymmetry of shocks affecting the economies and that the heterogeneity of behaviors does not seem to be of empirical relevance for the euro area.
Eric Jondeau and Jean-Guillaume Sahuc
Classification JEL : C51, C52, F4.
Keywords : Euro area, heterogeneity, Bayesian econometrics, multi-country model.
Updated on: 06/12/2018 10:58