A DSGE Model for the Spanish Economy (original) (raw)

This paper introduces MEDEA, a dynamic stochastic general equilibrium (DSGE) model tailored for the Spanish economy, developed during collaboration with the Economic Office of the President of Spain. MEDEA incorporates both real and nominal rigidities, aligning with New Keynesian frameworks to enable effective policy analysis and forecasting. The model accommodates small open economy aspects, characterized by a monetary authority following a Taylor rule, and captures technological changes and population dynamics, making it a credible tool for economic policymaking.