‘Introducing financial frictions and unemployment into a small open economy model,’ by Lawrence J.Christiano, Mathias Trabandt, and Karl Walentin.


The Dynare code for this model is here.

The code package contains separate directories with ready-to-use specifications of various submodels:

-         Full model, which includes financial frictions and a Diamond-Mortensen-Pissarides (DMP) search-matching framework for the labor market  (“CTW”)

-         No DMP (“Finfric”)

-         No financial frictions (“Unempl”)

-         Neither DMP nor financial frictions (“Baseline”)

-         Closed economy (“CTW_closed_ec”)

-         No endogenous separations (“CTW_exo”)