<p>I have a VAR model to forecast key economic variables like gdp and inflation, but I want to be able to do some sort of simulation to study a particular scenario.</p>
<p>I am running inflation expectations endogenously within the VAR, and now I want to create a counterfactual scenario where inflation expectations change to see the effect on the forecasts for the key economic variables.</p>
<p>I am not completely sure how I can go about the counterfactual scenario in the easiest way possible. Any suggestions on this?</p>

CC BY-SA 4.0
2022-10-31T02:47:09.987Z
What software are you using? Scenarios are fairly simple in eviews.
Jamzy
CC BY-SA 4.0
2022-10-31T03:21:58.443Z
@Jamzy using R studio
eddie
<macroeconomics><mathematical-economics><inflation><forecasting><simulations>
VAR model and simulation scenario
eddie
# VAR model and simulation scenario

(Asked by: username_0 on 2022-10-30)

I have a VAR model to forecast key economic variables like gdp and inflation, but I want to be able to do some sort of simulation to study a particular scenario.

I am running inflation expectations endogenously within the VAR, and now I want to create a counterfactual scenario where inflation expectations change to see the effect on the forecasts for the key economic variables.

I am not completely sure how I can go about the counterfactual scenario in the easiest way possible. Any suggestions on this?

**Tags:** macroeconomics, mathematical-economics, inflation, forecasting, simulations
> **Comments:**
> **username_1**: What software are you using? Scenarios are fairly simple in eviews.  
> **username_0**: @Jamzy using R studio  

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## 0 answers

