A series of macro-modelling exercises have already been conducted to assess the potential impacts of EU budgetary action. In this section, we start by reviewing the literature and by computing the results for the NGEU headings related to spending on climate; for climate-related investment in the MFF; and for climate-related R&D spending in the MFF. One key difference between NGEU and the MFF is that NGEU is supposed to be temporary. It should therefore be treated as a temporary shock in the various models. A recent paper by the ECB provides a detailed analysis of the macroeconomic impact of NGEU and compares the results of simulations done by two different models, – EAGLE and ECB-base – and with the basic model elasticities (BMEs) of the forecasting models in use in the national central banks of the Eurosystem. Another simulation exercise was carried out by the European Commission using the QUEST model. As described in Figure 7 above, only a certain proportion of NGEU will be directed towards spending related to the green transformation. The authors of the present report have therefore recalibrated the results so that they correspond to the climate part of the funds (representing €268 billion) within NGEU. Finally, they recall the results obtained with E3ME in the Annex II study.
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