What is Dynare ?
Dynare is a software platform for handling a wide class of economic models, in particular dynamic stochastic general equilibrium (DSGE) and overlapping generations (OLG) models. The models solved by Dynare include those relying on the rational expectations hypothesis, wherein agents form their expectations about the future in a way consistent with the model. But Dynare is also able to handle models where expectations are formed differently: on one extreme, models where agents perfectly anticipate the future; on the other extreme, models where agents have limited rationality or imperfect knowledge of the state of the economy and, hence, form their expectations through a learning process. In terms of types of agents, models solved by Dynare can incorporate consumers, productive firms, governments, monetary authorities, investors and financial intermediaries. Some degree of heterogeneity can be achieved by including several distinct classes of agents in each of the aforementioned agent categories.
Dynare offers a user-friendly and intuitive way of describing these models. It is able to perform simulations of the model given a calibration of the model parameters and is also able to estimate these parameters given a dataset. In practice, the user will write a text file containing the list of model variables, the dynamic equations linking these variables together, the computing tasks to be performed and the desired graphical or numerical outputs.
A large panel of applied mathematics and computer science techniques are internally employed by Dynare: multivariate nonlinear solving and optimization, matrix factorizations, local functional approximation, Kalman filters and smoothers, MCMC techniques for Bayesian estimation, graph algorithms, optimal control, etc. References to the literature can be found here.
Various public bodies (central banks, ministries of economy and finance, international organisations) and some private financial institutions use Dynare for performing policy analysis exercises and as a support tool for forecasting exercises. In the academic world, Dynare is used for research and teaching purposes in postgraduate macroeconomics courses.
Team
The Dynare project is hosted at CEPREMAP in Paris, France. Development is undertaken by a core team of researchers who devote part of their time to software development.
Advisory committee
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Fabio Canova, Professor of Economics at BI Norwegian Business School and Director of Budapest School of Central Banking Studies
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Matthew Canzoneri, Professor of Economics, Georgetown University
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Günter Coenen, Senior Adviser, European Central Bank
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Marco Del Negro, Economic Research Advisor, Macroeconomic and Monetary Studies, Federal Reserve Bank of New York
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Wouter den Haan, Professor of Economics at the London School of Economics and Political Science and co-director of the Centre for Macroeconomics
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Jesús Fernández-Villaverde, Professor of Economics, University of Pennsylvania
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Kenneth Judd, Senior Fellow at the Hoover Institution on War, Revolution and Peace, Stanford University
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François Langot, Professor of Economics at Le Mans Université and Senior member of the Institut Universitaire de France
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Douglas Laxton, Director of Saddle Point Research and The Better Policy Project
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Adrian Pagan, Emeritus Professor, University of Sydney
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Paolo Pesenti, Director, Monetary Policy Research Division, Federal Reserve Bank of New York
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Werner Roeger, Fellow at DIW Berlin and KU Leuven
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Juan Rubio-Ramirez, Professor of Economics, Emory University
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Thomas Sargent, Professor of Economics, New York University
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Frank Schorfheide, Professor and Chair of Economics, University of Pennsylvania
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Stephanie Schmitt-Grohé, Professor of Economics, Columbia University
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Lars E.O. Svensson, Affiliated Professor, Department of Economics, Stockholm School of Economics
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Robert Tetlow, Senior Adviser, Board of Governors of the Federal Reserve System
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Volker Wieland, Chair of Monetary Economics and Managing Director, Institute for Monetary and Financial Stability, Goethe University of Frankfurt
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Michael Woodford, Professor of Political Economy, Columbia University
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Rafael Wouters, National Bank of Belgium
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Tao Zha, Executive Director at the Federal Reserve Bank of Atlanta and Professor of Economics at Emory University
Governance
The Dynare project was founded by Michel Juillard in 1994. It consists of some code and a community of people who work on or around that code. The regular code contributors are collectively referred to as the “Dynare Team”, but this set of people doesn’t really define the entire project. There are additionally: occasional code contributors; the members of the “Dynare Advisory Committee”, who help the project in various ways; people who answer user questions on the forum, who report bugs or who improve the documentation… The communal nature of free/libre and open-source software makes it difficult to precisely define where the Dynare project ends and the greater community begins, which is exactly how we like it. We aim at reaching consensus over development decisions; however, if consensus cannot be reached on a particular issue, the decision is jointly taken by Stéphane Adjemian and Sébastien Villemot.