The MASST Model: A Generative Forecasting Model of Regional Growth

Abstract

This part of the book is devoted to the conceptual and methodological aspects that characterise our forecasting methodology. In particular, the present chapter provides an in-depth description of the MASST (MAcroeconomic, Sectoral, Social and Territorial) model – a combination of an econometric model of regional-national economic growth with a simulation algorithm – whose foremost purpose is to forecast medium-term trends in economic growth and demography for the new Europe (the enlarged EU plus the two new member countries, Bulgaria and Romania).2 Future economic and demographic tendencies are obtained under different scenarios: systems of consistent conjectures about how the trends affecting growth and the associated policies will manifest themselves in a fifteen-year perspective.