Module 7200
Recursive-dynamic multi-regional CGE modelling
Instructors
The course is offered at the Economic Modelling of Agricultural System Group, Institute for Food and Resource Eonomics, Rheinische Friedrichs-Wilhelm-Universitaet, Nussallee 21, 53115 Bonn. The instructors are:
PD Dr. Wolfgang Britz. Tel.: 0228 73 2912, Email: wolfgang.britz@ilr.uni-bonn.de
PD Dr. Yaghoob Jafari. Tel.: 0228 73 2502, Email: yaghoob.jafari@ilr.uni-bonn.de
Objectives
Students will
• gain an overview on the Solow-Growth model and how it is implemented in CGE models
• gain knowledge on how to introduce demand and supply drivers of structural change in CGEs
• reach a critical understanding how different drivers of structural change impact model outcomes
• gain knowledge on the Socio-Economic Pathways and their translations into quantitative scenarios, as well as how to use exogenous projections on demography and economic growth in CGEs
• gain hands-on experience how to conduct recursive-dynamic CGE analysis for their own research projects
• learn to systemically analyze dynamics developments with regard e.g. to production, demand, trade, prices, welfare and environmental indicators, drawing on micro-economic theory and considering the specific model configuration
• obtain skills on how to select relevant CGE results and how to communicate them
• develop the ability to successfully work in small groups under time pressure.
Background
This course is designed for advancing the knowledge and experience in recursive-dynamics CGE modelling and prepare students for using and adapting state-of-the-art multi-regional CGE models for own recursive-dynamic analysis. It focuses on the widely used multi-regional CGE model GTAP and variants thereof, as implemented in CGEBox. Students are not expected to work in software codes, but use Graphical User Interfaces.
This course builds on “Advanced multi-regional CGE modelling” by Britz and Jafari which uses CGEBox to conduct structural sensitivity analysis in a comparative-static mode.
The course is a combination of presentations by instructors and students, PC demonstrations, group work and assignments. During the course, participants will work in subgroups in parallel and prepare each day a presentation on a selected topic. Instructors will provide feedback and will be available during the group work phases to help with technical problems and/or to answer related questions.
Course description
Day 1: The Solow-Growth model and baseline construction
• The Solow growth model as the foundation of modeling economic growth in CGE analysis
• Endogenous macro-saving rates and capital accumulation, debt accumulation from trade imbalances
• The SSP portal as a source for projections related to the Solow growth model: demography, education, urbanization, economic growth
• A baseline with fixed growth and endogenous technological progress
Day 2: Demand side drivers of structural change
• Engel curves as demand side drivers of structural change: the AIDADS demand system
• Targeting calorie supply per capita
• Income dependent changes in the composition of government and investment demand
• Income dependent changes in the intermediate demand
• Differentiated productivity growth
• The role of land and natural resources in the Solow model
• Superimposing land and yield projections
• Sub-national detail and exogenous changes in contribution of regions to gross value added
Day 4: The Socio-Economic Pathways and sustainability indicators
• The SSP narratives and their translation into quantitative shocks
• Post-model micro-simulation
• Sustainability indicators
Day 5: Beyond CGEBox
• Vintages and endogenous technical progress in the MANAGE-WB
Teaching methods
Presentations (35%), PC-demonstrations (15%), Hands-on-exercises (50%)
Workload: 30 contact hours during the course; 30 hours of pre- and during course self-study
Requirements
- Students should bring their own notebooks with GAMS and CGEBox installed. Refer to details on the course web-site.
- Good understanding of intermediate microeconomics,
- Basic knowledge of general equilibrium modelling. Refer to material for self-learning phase for preparation
References
• Students should bring their own notebooks with GAMS and CGEBox installed. Refer to details on the course web-site.
• Good understanding of intermediate microeconomics
• Having taken the course “Advanced multi-reginal CGE modelling” is recommended. Students with no background in CGE modeling are strongly advised to first take another course on fundamentals of CGE analysis before enrolling. Some material for a refresher can be found on material for self-learning phase
Certificate
A certificate of successful participation will be issued if
• the student has properly prepared the assigned presentation and handed it in on time
• participated actively at all group works
• contributed to presentations