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Danish government makes its new economic model open source

Economic modelling is always research, subject to debate and continuous improvement. But at some point the powers that be need to do some real policy-making, taking decisions affecting lots of people. It can be informative to look at the tooling the said powers use to make their decisions more rational and data-informed. I haven't found before anything as self contained and fully disclosed as this project from the Danish Ministry of Finance, DREAM-DK/MAKRO. The stated goal is to understand, control or predict the economic results of shocks or interventions. Two strands of thought, equlibrium/dynamics and matrix modeling have neon signs for categorists saying "enter here". (ch. 10 of Documentation.pdf is dedicated to I/O tables). I have wanted to add this to this old, 2018 post.

Comments

  • 1.

    Don't have anything to add that wasn't discussed in that 2018 forum thread. Game theory is hard, perhaps intractable.

    Comment Source:Don't have anything to add that wasn't discussed in that 2018 forum thread. Game theory is hard, perhaps intractable.
  • 2.

    Here is a 2000 working paper from the Levy Institute on a stock-flow consistent model of the Danish economy. There was a cheap paperback in the early 1980s by Wynne Godley on the approach whose team formulated it at the Cambridge Dept. of App. Econ. which I coded up in C as a hobby project but perhaps unsurprisingly I've now lost. https://www.levyinstitute.org/pubs/wp_891.pdf

    Comment Source:Here is a 2000 working paper from the Levy Institute on a stock-flow consistent model of the Danish economy. There was a cheap paperback in the early 1980s by Wynne Godley on the approach whose team formulated it at the Cambridge Dept. of App. Econ. which I coded up in C as a hobby project but perhaps unsurprisingly I've now lost. https://www.levyinstitute.org/pubs/wp_891.pdf
  • 3.

    Hope to have time to look closerly at some point. Think this is a complementary view, accounting also for Central Banking which MAKRO didn't have IIRC. It's noticeable that your referenced model foresaw the subprime credit crunch. There is a money manager in my country praised for the same (Paramés).

    Comment Source:Hope to have time to look closerly at some point. Think this is a complementary view, accounting also for Central Banking which MAKRO didn't have IIRC. It's noticeable that your referenced model foresaw the subprime credit crunch. There is a money manager in my country praised for the same (Paramés).
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