Effective Macroeconomic Model for GDP Analysis, Albanian Case

Abstract

The study aims to create a macroeconomic market model, through which to analyze nominal and real GDP, to analyze the impact of prices on GDP, create a model of aggregate demand curve, using price deflator, etc. It aims to calculate the Price Deflator and real GDP starting from 1990, as the first year of calculating the macroeconomic indicators of the Albanian economy. More detailed analysis is focused on the years 2000-2017. It has been proven that the deflator calculated by INSTAT is almost equal to the nominal GDP average of the price increase. This data was used to construct the market model with Albanian economy data, with Aggregate Price and real GDP. The new model of the aggregate market differs from the existing one. It expresses the nominal GDP curve as a listing of real GDP at and has a positive slope. This model enables a detailed analysis of nominal and real GDP can be used by anyone, and for any economy. It is recommended for the government and the Albanian institutions to apply this model, as it is effective. Statistical, econometric, analysis, synthesis, comparison, etc. methods were used in the analysis.