Model Simulation

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August 31, 2024 4 min read Definitions

Calibration: Identification of Numerical Values in Economic Models

Economics Statistics Economic Models Business Cycles Model Simulation Empirical Observations Parameter Tuning

Calibration is the process of identifying numerical values for parameters in an economic model by combining empirical data, informed judgement, simulation, and fine-tuning to match model predictions with empirical observations. This procedure is crucial in assessing business cycle models.

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