Dynamic and long-term properties of the ThreeME model

Abstract

This paper provides an analysis of the dynamic and long-term properties of the ThreeME model. Several scenarios were simulated: An increase in oil prices, a reduction in payroll taxes for employers, an increase in VAT, an increase in public investments and the introduction of a carbon tax. We analyzed the impact of different wage equations on the results obtained by simulating each scenario with a Wage Setting curve and a Phillips curve. We also compared our results with those of the French Treasury’s MESANGE model, as well as two different versions of ThreeME (a standard version and a hybrid version including a bottom-up representation of housing and private vehicle stocks).

Publication
Revue de l’OFCE, 149
Date