On the Construction of an Intertemporal Model of Growth, Accumulation and Trade: Transitional Dynamics, Calibration Strategy and Simulation Analysis

Date

1997

Author

Diao, Xinshen
Yeldan, A. Erinç

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A multi-region, dynamic computable general equilibrium model is introduced to study issues of accumulation, growth, and consumer welfare in the context of a global economy segmented into polar blocs. The model is based on intertemporal optimization behavior of forward-looking Ramsey- consumers with three endogenously specified world regions -Rich, Poor, and Middle-Income; and four aggregated sectors. We calibrate the model to the recent GTAP data base, and present a simulation experiment addressing to the dynamic effects of a productivity decline in agriculture of the industrial Rich region. We report both the transition and the steady state equilibrium paths following the productivity shock.

URI

https://hdl.handle.net/11511/112304

Collections

Department of Economics, Article