Definition of Calibration: 1. Calibration is the estimation of some parameters of a model, under the assumption that the model is correct, as a middle step in the study of other parameters. Use of this word suggests that the investigator wishes to give those other parameters of the model a 'fair chance' to describe the data, not to get stuck in a side discussion about whether the calibrated parameters are ideally modeled or estimated.
2. Calibration is taking parameters that have been estimated for a similar model into one's own model, solving one's own model numerically, and simulating. Attributed to Edward Prescott. (Econterms)