SFC Models

Chap 3 | Chap 4 | Chap 5 | Chap 6 | Chap 7 | Chap 8 | Chap 9 | Chap 10 | Chap 11

In this section, the chapter codes behind Wynne Godley and Marc Lavoie‘s book Monetary Economics (2012, 2nd edition) are discussed using interactive Mathematica files. Godley and Lavoie develop a system of stock-flow consistent (SFC) monetary accounting for a closed macroeconomic framework. Relationships between sectors (households, firms, financial, government) are defined using behavioral relationships and accounting identities that gives a fully tractable parameterized system. While the book focuses mostly on monetary economics, the application of the SFC framework has been significantly extended to study a large set of topics. SFC-models.net, a dedicated forum for SFC modeling, highlights the research being done in this area.

The Mathematica files are based on the E-views code developed by Gennaro Zezza (University of Cassino, Italy). The code has been adapted for Mathematica and fine tuned using Kevin Capehart’s Mathematica demonstration code.

Each chapter is discussed separately. In some browsers you might need to enable the Mathematica plug-in using the plugins pop-up in the top-right corner of the browser. You can also install the free Mathematica CDF player.

As a note of caution, avoid using the slider or run command for more advanced codes since they require significant computational power to solve for each parameter selection. In case you want to test the outputs for different parameter values, enter the value in the box below the slider, press enter and wait for the graphs to update.

Chap 3 | Chap 4 | Chap 5 | Chap 6 | Chap 7 | Chap 8 | Chap 9 | Chap 10 | Chap 11

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