With Michael Woodford having recently been awarded the Nobel Memorial Prize in Economic Sciences and the seminal Smets and Wouters article in the Journal of the European Economic Association now more than twenty years old, DSGE models have become firmly embedded in the toolkit of central banks. This seminar will revisit their emergence and widespread adoption in policy institutions, assess the lessons learned from their practical use, and discuss the main criticisms they have faced. It will also explore current directions for the future development of macroeconomic modelling in central banking.
