Mihaela Simionescu

Institute for Economic Forecasting of the Romanian Academy,

 Bucharest, Romania

mihaela_mb1@yahoo.com

GDP RATE IN THE EUROPEAN UNION:  SIMULATIONS BASED ON PANEL DATA MODELS

Kamil Dobeš

Tomas Bata University in Zlin, Czech Republic

dobes@fame.utb.cz

Ivan Brezina

Pan-European University,

Bratislava, Slovakia

brezina.ivan@yahoo.com

Andrea Gaal

Pan-European University,

Bratislava, Slovakia

gaal.a@gmail.com

 Abstract. The main aim of this article is to explain the evolution of real GDP rates in the European Union (EU-28) over the period 2004-2015 using panel data sets. Several dynamic models (6 models) explained the real GDP growth, an increase in the real GDP rate in the previous period at 1% generating an increase in the real GDP rate in the current period with a value between 0.3% and 0.5%. A Fixed Effects Model with individual effects and effects in time explained the real GDP growth using employment as an explanatory variable. Moreover, a panel data model is estimated, the assumptions related to errors, however, are not checked. Simulations for 2016 and 2017 are conducted using the Dynamic Model and the Fixed Effects Model, the latter anticipating higher GDP rates as compared to dynamic models. The result of this study is the estimation of the real GDP rates in the EU-28 countries, which are based on the presented econometrics models. The annual average rate of employment as the main factor of GDP growth is taken into account.

Received: July, 2015

1st Revision: September, 2016

Accepted: November, 2016

DOI: 10.14254/2071-8330.2016/9-3/15

JEL Classification: C150, C530   

Keywords: GDP rate, employment, panel data, Dynamic Model, Fixed Effects Model