Testing one developed model by the parametric control theory methods

What is it about?

1. One global computable general equilibrium model was built and calibrated (hereinafter – Model) 2. The effectiveness of application of two developed numerical algorithms for the evaluation of sustainability indicators and the sustainability assessment (in the sense of stability theory of smooth mapping) of model defined mapping as part of the problem solving of this Model testing on the possibility of its practical application. 3. Based on the tested Model provided the results of the solution for a number of parametric regulation problems, aimed to the economic growth, and reduction of economical imbalance in the Regions development.

Featured Image

Why is it important?

1. Before the mentioned paper, there were no multi-country models, macroeconomic analysis methods and drawing up of recommendations in area of economic activity at the level of the countries of the Eurasian Economic Union, operating in an environment of the global economy. The built and calibrated model is designed to solve relevant problems with - macroeconomic analysis of national and regional economies functioning - finding the optimal values of economic policy instruments for both national economies, and regional alliances; assessment of their realizability. 2. In natural sciences and economics for studying characteristics of domain objects mathematical models of the relevant subject objects (tasks) are widely used. However, fulfillment conditions of adequate transferring of mathematical models research results to the relevant subject areas requires extensive testing of the models on the possibility of their practical application. In the theory of parametric control of macroeconomic systems [A.A. Ashimov, B.T. Sultanov, Zh.M. Adilov, Yu.V. Borovskiy, D.A. Novikov, R.A. Alshanov, As.A. Ashimov, Macroeconomic analysis and parametrical control of a national economy (New York: Springer, 2013)] together with traditional methods a number of new techniques and appropriate developed algorithms are suggested. These include: - Methods of sustainability indicators evaluation defined by the mapping model, transforming values of the selected set (input) exogenous model parameters to the values of its endogenous variables. - Methods of sustainability assessment defined by mapping model [Ashimov, A., Adilov, Zh., Alshanov, R., Borovskiy, Yu. and Sultanov, B. (2014), “The Theory of Parametric Control of Macroeconomic Systems and Its Applications (I)”, Advances in Systems Science and Application, Vol. 14, No.1, pp. 1-21; Golubitsky, М. and Gueillemin, V. (1973), Stable mappings and their singularities, Springer-Verlag, New York, Heidelberg, Berlin]. - Assessment methods of structural stability model (in case it is defined as continuous autonomous dynamical system). Before the mentioned paper, there were no examples of these methods adoption for multi-country models describing the functioning of regional union economies in the environment of world economy. The effectiveness of three testing methods of macroeconomic models on the basis of the developed Model was demonstrated in this paper. 3. Those approaches to the drawing-up of recommendations in the area of optimal economic policy based on parametric control theory and tested models are new.

Perspectives