The federal reserve board MPS quarterly econometric model of the US economy

Abstract

This paper describes the structure and properties of the Federal Reserve Board's (MPS) econometric model of the US economy. The theoretical underpinnings are developed using a small growth model that is a simplified version of the steady-state structure of the full model. Short-run dynamic properties, which are Keynesian, are discussed and quantified with simulation results. The largest part of the paper consists of a discussion of the theoretical basis and empirical properties of the key behavioural equations. A complete list of equations is included. © 1985.