Macroeconomic and Trade Policy Impacts Based on DSGE Model

At present, in the context of economic de-globalization, especially the impact of COVID-19, the adjustment of one country's macroeconomic and trade policies will have spillover effects on trading partners. Build DSGE models between the two countries, in which Epstein - Zin utility function replacement time can be divided into the utility function, to solve the model, using the second order approximate solution technology with particle filter to estimate the parameters, and analysis of the open economy under the background of a country's technological progress, monetary policy, labor supply, government spending and tariff policy on macroeconomic impact between the two countries. It is found that the impact of China's technological progress on F country's macro economy is greater than that of F country on China. The spillover effect of monetary policy on another country's macro economy will change the consumption structure of both countries. The impact of China's labor supply shock on the total investment of F country is greater than that of F country on China. The positive impact of government spending on another country's inflation rate is lower than other policy shocks. The impact of the positive impact of government expenditure in F country on China's aggregate demand is greater than that of China on F country. The imposition of tariffs will have a negative impact on the economy in the short term. Although the import tariffs imposed by F country can improve the domestic aggregate demand and employment of F country, it will reduce the domestic aggregate consumption level.