Science Fair Project Encyclopedia
Model (macroeconomics)
A model in macroeconomics is designed to simulate the operation of a national or international economy in terms of factors including the total amount of goods and services produced, total income earned, the level of employment of productive resources, and the general behavior of prices.
Such models are used to generate economic forecasts, and to produce what if scenarios, and are widely used by international organisations, national governments and larger corporations, as well as by economics consultancies and think tanks.
Dutch economist Jan Tinbergen developed the first comprehensive national model, which he first built for the Netherlands and later applied to the United States and the United Kingdom after World War II.
The first global macroecomomic model, Wharton Econometric Forecasting Associates LINK project, was initiated by Lawrence Klein and was mentioned in his citation for the Bank of Sweden Prize in Economic Sciences in Memory of Alfred Nobel in 1980.
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