In DREAM we maintain and develop a set of tools used for analysis of the Danish economy:
GreenREFORM: DREAM is in the process of developing a new environmental and climate-economic model for the Danish economy. The baseline simulation should provide a comprehensive assessment of how future economic development is expected to affect the environment and climate. Further, the baseline simulation should assess whether this development is compatible with the political goals within these areas.
MAKRO: DREAM is developing the new macroeconomic model MAKRO for the Ministry of Finance of Denmark. The MAKRO model’s purpose is to project and forecast the Danish economy in the medium to long term as well as to evaluate effects of economic policy.
DREAM-model-system: The so called DREAM-model-system consists of projections of population, education and labor supply (our demographic projections), which feed into the computable general equilibrium dynamic macroeconomic model (the DREAM model) which is calibrated to the Danish economy. These different components allow the DREAM group to perform economic analysis, with a particular emphasis on investigating the public finance sustainability of economic policy.
Other economic models: The DREAM group has also developed both a static general equilibrium model, the REFORM model, and a dynamic micro-simulation model, the SMILE model. The core focus of the REFORM model is the input-output structure of the Danish economy and is used to evaluate the impact of productivity and competition characteristics of the different sectors and the impact of tax policy on inter-sector activity and on the aggregate economy. The core focus of the microsimulation model SMILE is to evaluate distributional impacts across regions and population groups of public policy changes.