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on Computational Economics |
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Issue of 2006‒07‒09
four papers chosen by |
| By: | Pekka Sulamaa; Mika Widgrén |
| Abstract: | This paper examines the economic effects of the opening of the Russian Federation. The analysis carried out in the paper is two-fold. First we simulate the impact of the eastern enlargement of the EU and, second, we analyse how deeper integration between the EU and Russia contributes to this. The analysis is carried out with GTAP computable general equilibrium model. We find that there is a trade-off between the two roads of European integration arrangements. Eastern enlargement seems, even in its very deep form, be beneficial for all EU regions without causing substantial welfare losses outside the Union. EU-Russia integration, on the other hand, has different impact. To be beneficial for Russia free trade between the EU and Russia requires improved productivity in the latter, which may be due to better institutions or increased FDI. This might make the negotiations of the agreement cumbersome and if agreed its implementation difficult. |
| Keywords: | Integration, Free Trade Agreement, GTAP, EU, Russia |
| Date: | 2004–12–16 |
| URL: | http://d.repec.org/n?u=RePEc:fer:dpaper:356&r=cmp |
| By: | Gary S. Anderson |
| Abstract: | This paper compares the functionality, accuracy, computational efficiency, and practicalities of alternative approaches to solving linear rational expectations models, including the procedures of (Sims, 1996), (Anderson and Moore, 1983), (Binder and Pesaran, 1994), (King and Watson, 1998), (Klein, 1999), and (Uhlig, 1999). While all six prcedures yield similar results for models with a unique stationary solution, the AIM algorithm of (Anderson and Moore, 1983) provides the highest accuracy; furthermore, this procedure exhibits significant gains in computational efficiency for larger-scale models. |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgfe:2006-26&r=cmp |
| By: | Hildegunn Ekroll Stokke (Department of Economics, Norwegian University of Science and Technology) |
| Abstract: | We study the impact of a natural resource boom on structural change and real exchange rate dynamics, taking into account the indirect effect via relative sectoral productivity changes. Our contribution relative to the Dutch disease literature is threefold. First, the productivity specification is extended from simple learning by doing to include trade barriers and technology gap dynamics, consistent with the modern understanding of productivity growth. Second, we offer a dynamic general equilibrium model with imperfect substitution between domestic and foreign goods. Third, the model is applied to South Africa and analyzes the macroeconomic impact of the gold price increase in the 1970s. Political pressure for rapid domestic spending after a surge in resource rents tends to generate myopic government behavior with unsustainable high consumption spending. Such fiscal response to higher resource income is captured by the model specification. Numerical simulations show how the resource boom can help explain the structural change and real exchange rate path observed in South Africa. Due to productivity effects the initial real appreciation is followed by gradual depreciation of the real exchange rate. |
| Keywords: | gold price boom;Dutch disease;trade barriers;fiscal response;deindustrialization |
| JEL: | O33 O41 O55 Q33 |
| Date: | 2006–05–22 |
| URL: | http://d.repec.org/n?u=RePEc:nst:samfok:7206&r=cmp |
| By: | Stéphane Mechoulan |
| Abstract: | Communicable diseases pose a formidable challenge for public policy. Using numerical simulations, we show under which scenarios a monopolist’s price and prevalence paths converge to a nonzero steady-state. In contrast, a planner typically eradicates the disease. If eradication is impossible, the planner subsidizes treatments as long as the prevalence can be controlled. Drug resistance exacerbates the welfare difference between monopoly and first best outcomes. Nevertheless, because the negative externalities from resistance compete with the positive externalities of treatment, a mixed competition/monopoly regime may perform better than competition alone. This result has important implications for the design of many drug patents. |
| Keywords: | communicable disease, resistance, epidemiology, patent |
| JEL: | I18 L12 |
| Date: | 2005–06–27 |
| URL: | http://d.repec.org/n?u=RePEc:tor:tecipa:tecipa-241&r=cmp |