Econometrics Seminar - Alex Ballantyne (Reserve Bank of Australia)

Macroeconomic Seminar Series

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Tomasz Wozniak

tomasz.wozniak@unimelb.edu.au

T: +61 3 8344 5310

Title: MARTIN Has Its Place: A Macroeconometric Model of the Australian Economy

Abstract: This paper introduces MARTIN, the Reserve Bank of Australia’s new model of the Australian economy. MARTIN is an economy-wide model used for forecasting and counterfactual scenario analysis. In contrast to other models used at the Bank (and at many other central banks) which adhere to a narrow theoretical view of how the economy operates, MARTIN is a macroeconometric model that consists of a system of reduced-form equations built to strike a balance between theoretical rigour and empirical realism. We provide an overview of the model, describe its main equations and demonstrate its responses to various scenarios.