Instructor: Sopio Mkervalidze
Format: 5-Day Intensive One-on-One Course
Schedule: 2 Hours per Day (Flexible Scheduling Available)
Platform: Dynare/MATLAB
Offered by: The Better Policy Project

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Course Overview

This personalized training program introduces central bank economists, researchers, and advanced practitioners to the ENDOCRED model—an advanced semi-structural tool designed for flexible inflation targeting under imperfect credibility. ENDOCRED lies at the core of the Forecasting and Policy Analysis System (FPAS) Mark II, increasingly adopted by central banks transitioning from baseline-focused frameworks to risk-based monetary policy decision-making.

ENDOCRED innovatively incorporates endogenous monetary policy credibility, nonlinear dynamics such as convex Phillips curves, and an explicit policy loss function to better capture the tradeoffs central banks face—especially in emerging markets vulnerable to stagflationary shocks and volatile credibility dynamics.

Originally developed and applied to Armenia as a small open economy, ENDOCRED builds on the foundational work of Argov et al. (2007) and Kostanyan et al. (2022), and offers a dynamic framework applicable to other emerging economies using the FPAS Mark II system.

All modeling and simulations in this course are conducted using Dynare in MATLAB, the standard environment for semi-structural macroeconomic modeling.

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What You'll Learn

• The theoretical foundations and empirical implementation of the ENDOCRED model

• How to operationalize policy credibility as an endogenous variable

• Structural components of the model:

  • Nonlinear Phillips Curve

  • Inflation expectations formulation under imperfect credibility

  • Monetary policy loss function as an alternative to reaction functions

  • Exchange rate dynamics and country-risk premium feedback

• How to calibrate the model to a specific small open economy

• Application of ENDOCRED to real-world policy challenges using scenario analysis within FPAS Mark II

• Strategies for transparent central bank communication under uncertainty

• Hands-on modeling and policy simulations using Dynare/MATLAB

 

 

Who Should Attend

This course is designed for:

• Central bank staff in modeling, research, and monetary policy divisions

• Economists and researchers involved in policy modeling or risk management

• FPAS Mark I practitioners transitioning to Mark II frameworks

• Policy advisors seeking to understand the implications of credibility loss and nonlinear policy tradeoffs

 

 

Course Format and Customization

The course is delivered one-on-one by Sopio Mkervalidze, a seasoned expert in macroeconomic modeling and policy design. Sessions are tailored to the participant’s country context or modeling priorities, with the opportunity to integrate your own data or use the Armenia case study as a learning platform.

 

 

Daily Format:

• 2 hours of live, interactive instruction

• Follow-up exercises and feedback

• Hands-on coding in Dynare/MATLAB

• Optional readings and modeling assignments

Cost per participant: 1,000 Euros.

 

Contact Us to register and to tailor the course to your institution’s needs!