The documentation for the MCH model is in
The MCH Model Workbook: April 27, 2012
Appendix A: The US Model, April 27,
Appendix B: The ROW Part of the MCH Model:
April 27, 2012.
You should also read Chapter 2 of
Estimating How the Macroeconomy
Data from the MCH model can be downloaded online
by going to the output phase when working with the MCH model
and downloading from there.
If you want to download the MCH model for use on your own machine,
this can be done by downloading the Fair-Parke (FP) program and the MCH model
files that go with the FP program.
One of the files that needs to be downloaded is
about 23 MB in size.
The following are the downloadable files:
FP.ZIP 0.8 MB
Contains FP.EXE, the FP compiled program.
MC.ZIP 0.3 MB Contains the following files,
which are called by SP7DIST.INP or by STIMUL.INP:
SP7BIN.ZIP 22.9 MB Contains SP7.BIN:
all the data (1960.1-2020.4).
SP7OUT.ZIP 2.6 MB Contains SP7.OUT:
the output file from executing SP7DIST.INP.
FPCOD.ZIP 0.2 MB
Contains FP code if you want to compile yourself (optional).
To work with the MCH model
once you have
downloaded the files and unzipped them, run at the DOS prompt:
FP > OUT (hit return)
INPUT FILE=SP7DIST.INP; (typing will not show up on screen, don't forget
This job loads all the data, estimates the model, and runs a test job.
The output from the test job is in the file SP7.OUT, and your OUT file
should match SP7.OUT subject to rounding error.
If so, then everything is probably working properly.
You need to know how to use the FP program in order to work with the
MC model. You may want to download the FP test examples from the website
and run these first in order to get familiar with the program.
(See The Fair-Parke Program.)
There are many comments in SP7DIST.INP and in the .INP files that it
calls. You should read these carefully to make sure you know what is going
on. You should note the following:
- A number of "tricks" have to be used in SP7DIST.INP to link the quarterly
and annual data. These are noted in the file. The annual data are
stored in the first quarter, with the remaining three quarters having
"missing" values. A lag of 4 for an annual country is a lag of one year,
not four years.
- There are two sets of trade share variables (the alphas): A____ and
AA____. The AA____'s are the ones predicted by the trade share equations,
and the A____'s are the ones that are constrained to sum to 1. The
trade flow variables are denoted X____.
- A solution period must begin in the first quarter of a year and end in
the fourth quarter of a year. Otherwise the tricks of linking the
quarterly and annual data do not work.
- The stochastic equations are numbered 1 through 307 (before getting
to the trade share equations). The PRINTMODEL command allows you to see the
numbering of the equations.
- Note the different treatment before and after 1999.1 regarding the
EMU countries (dummy variables EU1 and EU2).
This is explained in comments in SP7DIST.INP.
- Once you learn how to work with the MC model in the FP program, all the
FP commands are at your disposal, and so much experimentation can be done.
- Some of the data for 2010 and 2011
do not match exactly the data used for the
coefficient estimates that are on the site.
This is because some of the data are predicted
data that differ slightly from the actual data when the actual data are
available. Actual data were used for the coefficient estimates for the
website version of the model, whereas predicted data are used for
the downloaded version of the model. This only concerns a few
countries and only for at most 2010 and 2011,
and the coefficient-estimate differences are small. This is nothing one need