The Ararat Fiscal Strategy Model: A Structural Framework for Fiscal Policy Analysis in Armenia

Abstract

IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Republic of Armenia

“…The reforms assessed in this analysis are also part of the Government's 2021-26 program and aim to: (i) increase labor force participation; (ii) enhance access to credit; and (iii) raise the efficiency of public capital spending. Their impact is simulated using a calibrated general equilibrium model building on Babajanyan, Baksa et al (2022), which captures key features of the Armenian economy. It consists of a small open economy with price and wage rigidities, two sectors (trade and non-traded), and two types of households (savers and non-savers).…”