Forecasting for the Russian Economy Using Small-Scale DSGE Models
This study examines the ability of a small-scale DSGE model to forecast the dynamics of key macroeconomic variables for the Russianeconomy. The study uses two versions of a standard model of a small openeconomy, adding a stochastic oil price trend under various assumptions about exchange rate policy. Comparison with the same size BVAR model shows DSGE models to be superior as regards exchange rate, price and interest rate forecasting and slightly inferior with respect to GDP forecasting.