1 Macroeconomic Policy in Europe: Experiments with monetary responses and fiscal impulses Ray Barrell 1 , Bettina Becker, Joseph Byrne, Sylvia Gottschalk, Ian Hurst and Desirée van Welsum National Institute of Economic and Social Research Abstract: In this paper we discuss the main model properties of NiGEM, the National Institute’s large-scale macroeconometric model. NiGEM is a ‘New-Keynesian’ model where agents display forward looking behaviour but there are nominal rigidities slowing adjustment. In a number of policy simulations we find there are strong similarities across countries. Nevertheless, Euro Area responses to monetary and fiscal policy are greatest in Germany in NiGEM, whilst these responses are slower in comparison to the US due to greater wage-price inertia. JEL: C50, E17, E58 Keywords: Macroeconomic modelling, Policy analysis, EMU. 1 Corresponding author. 2 Dean Trench Street, Smith Square, London SW1P 3HE. United Kingdom. Telephone:+44-(0)20-7654 1925, Fax: +44-(0)20-7654 1900, e-mail: R.Barrell@niesr.ac.uk.