World Economy Model

VIEW is Prognos’ global forecast and simulation model. VIEW comprises 125 countries, which represents approximately 98 percent of the current global economic output. VIEW enables a detailed and consistent representation of the future development of the global economy. In VIEW, interactions between countries are explicitly modelled.

VIEW is made up of individual country models. These can be divided into two groups: the models for the 37 leading industrialised and emerging countries are identically structured and include approx. 600 demographic and macroeconomic variables as well as a variety of foreign trade parameters. The models of the remaining countries have similar functional relationships but are much less detailed due to the poorer data situation. The development of the economic sectors is determined in sub-modules of the country models based on input-output tables. Historical data usually goes back as far as 1970, and the forecast period can, if necessary, extend as far as 2060.

A single country model can be calculated in isolation from the other models with specified global economic conditions. In the model network, the country models exchange information (import demand, interest rate, price, and wage levels etc.) until a stable solution is found for all variables in all country models. In this way, it is possible to show not only how a shock in one country affects the other VIEW countries, but also how their reaction affects the shock-triggering country.