Macroeconomic Model for Ukraine

Abstract

This paper presents the most recent version of the quarterly Macroeconomic Model of the Ukrainian economy, its assumptions and possible applications. This model represents anunorthodox approach in analysing economies in transition. It covers transactions in both official and shadow economies.

The volume and value of shadow transactions were estimated using an unconventional methodology, beginning with the analyses of overall consumer demand. This, in turn, was derived from official households surveys. The next steps included estimating cross-border trade and investment-in-kind.

Possible applications of the model are: short- and medium-run forecasts based on the whole model, projections of particular variables, and building various scenarios of policy-mix in Ukraine.