The project was created, under the leadership of Kopint-Tárki, through international cooperation. Four additional institutes took part in its implementation: Teagasc Mellows Campus in Dublin (in the person of one of the most outstanding experts in the field, Cathal O’Donoghue), OGResearch in Prague, and two Hungarian institutes, IID and CEE Bills.
The aim of the project was the development of a system of models that can be used to the complex, direct and indirect, economic and social impact assessment of economic policy measures. The macro model needs to be suitable for (1) integrating a dynamic/behavioral household microsimulation model, developed based on the already available ECOS-TAX model, (2) incorporating household income, consumption and the changes in labor supply and demand into the macro model, and (3) interactive communication with the micro model.
To this end, we developed during the project
- A system of macro models suitable for macroeconomic forecasting and impact assessment
- A system of dynamic/behavioral household micro-simulation models and its income, consumption, labor market and dynamic modules
- A solution for the interactive interconnection of the two model systems and the data flows between them, on the levels of data content, logic and IT systems.
The two macro models together can achieve the combined objective of the project – that is, performing the forecasting and impact assessment functions and successfully integrate the micro model. The application of the GAP model and the CGGE model and their working together is the optimal solution that can – through the combining of the advantages of the different macro models – coherently ensure that the requirements of theoretical soundness (coherence, explanatory power) and empiric relevance (the ability to describe developments in the past and future with an appropriate accuracy) are both met.