nep-cmp New Economics Papers
on Computational Economics
Issue of 2009‒06‒10
seven papers chosen by
Stan Miles
Thompson Rivers University

  1. BIMSTEC-Japan Trade Cooperation and Poverty in Asia By John Gilbert
  2. Trade Policy, Poverty, and Income Distribution in CGE Models: An Application to SAFTA By John Gilbert
  3. IFSIM Handbook By Baroni, Elisa; Zamac, Jovan; Öberg, Gustav
  4. A 'Live' Version of the HOS Model in Excel By John Gilbert
  5. System Dynamics Simulation to Test Operational Policies in the Milk-Cheese Supply Chain. Case Study: Piar Municipality, Bolivar State, Venezuela By Rodriguez Monroy, Carlos; Fuentes-Pila, Joaquín; Guaita, Wilfredo
  6. An integrated simulation model to evaluate national policies for the abatement of agricultural nutrients in the Baltic Sea By Hyytiainen, Kari; Ahtiainen, Heini; Heikkila, Jaakko; Helin, Janne; Huhtala, Anni; Iho, Antti; Koikkalainen, Kauko; Miettinen, Antti; Pouta, Eija; Vesterinen, Janne

  1. By: John Gilbert (Department of Economics and Finance, Utah State University)
    Abstract: We review the literature on the relationship between trade policy reform and poverty, and recent approaches in the numerical simulation literature to estimating the impact of alternative trade reform scenarios. The GTAP model is then used to simulate the effect of the trade cooperation among the economies of BIMSTEC and Japan on aggregate welfare and poverty in the BIMSTEC member economies. As a case study, the results of the global model simulations are then used as an input to a more detailed model of simulation model of India, which identifies nine household groups classifed by their source of income and consumption pattern. Detailed estimates of the eect of trade reform at the household level are presented for India.
    Keywords: Trade reform, CGE, regional trading agreements, poverty, India, BIMSTEC
    JEL: F13 F17 C68 O53
    Date: 2008–12–19
  2. By: John Gilbert (Department of Economics and Finance, Utah State University)
    Abstract: We describe a new CGE model of South Asia, and its application to understanding the socio-economic aspects of SAFTA. The model currently covers India, Sri Lanka and Bangladesh, and the rest of South Asia. It is being expanded to include Nepal and Pakistan. The model incorporates modifications to the household structure to capture implications of reform for intra-household income changes.
    Keywords: SAFTA, CGE, Poverty
    JEL: F13 F17 C68 O53
    Date: 2008–12–19
  3. By: Baroni, Elisa (Institute for Futures Studies); Zamac, Jovan (Institute for Futures Studies); Öberg, Gustav (Institute for Futures Studies)
    Abstract: <p>This handbook explains the simulation model IFSIM. IFSIM is an agent based simulation model written in JAVA. The model is constructed for analyzing demographic and economic issues. The aim of the model is to include the main consumption and production patterns over the life-cycle and thus being able to test demo-economic interactions.<p>
    Keywords: agent-based modelling; simulation model; JAVA; demogrphy; economy; demo-economic interactions
    JEL: C63 J11
    Date: 2009–05–20
  4. By: John Gilbert (Department of Economics and Finance, Utah State University)
    Abstract: We present a numerical version of the factor proportions (Heckscher-Ohlin-Samuelson) model of production in a small economy, built in Excel. The model features the most common graphical devices used to explain the model properties. It differs from earlier work in that the solution is embedded in the sheet, making the use of the Solver add-in unnecessary. The equilibrium values and graphics respond instantly to changes in parameters/exogenous variables. The model can be used to demonstrate the Stolper-Samuelson and Rybczynski theorems, as well as other scenarios.
    Keywords: Heckcher-Ohlin-Samuelson model, Factor proportions
    JEL: A2 D5 F1
    Date: 2009–06–10
  5. By: Rodriguez Monroy, Carlos; Fuentes-Pila, Joaquín; Guaita, Wilfredo
    Abstract: With the purpose of detecting the impact that variations of demand cause in the milk-cheese supply chain, and determining how the operational policies of capacity, inventories or labor force can mitigate this impact, a system dynamics simulation model has been designed based on a survey conducted on a sample of cheese manufacturers and their links with milk farms, transportation companies and cheese distributors. This supply chain will be consolidated when a milk center that will collect the raw milk is completed. From this center, and after adequate treatment, milk will be distributed to the different cheese manufacturers in the supply chain. Managing adequately the milk-cheese supply chain represents an important challenge due to the short life of these products. Although this study was done in a region in Latin America, its results can be applicable to food supply chains by introducing some modifications. The milk-cheese supply chain in this case study contemplates three milk producers, one milk supplier, five cheese producers, one wholesaler and several distributing agents. These companies operate individually under normal conditions, but they have understood that their integration in a supply chain improves the competitiveness of all its members. That is to say, the sum is greater than the parts. For its initial design a simulation software model is used in which the resources of the supply chain are optimized. Later the product of this optimization facilitates some initial values to be used in the system dynamics model in which cause-effect or influence relationships have been previously established considering the most representative variables. Finally, changes in operational policies that can reduce the level of pending orders in the supply chain are tested using other simulation software. The main contribution of this research is that it can serve as support or contribute to reduce the uncertainty in the decision making process of the supply chain management due to the speed with which individual or combined policies can be analyzed. In response to a variation of demand the most adequate policy may be selected and that can be done before the policy is implemented.
    Keywords: Supply Chain, Milk Producers, Cheese Industry, Dynamic Simulation, Operational Policies, Agribusiness, Agricultural and Food Policy, Farm Management, Food Consumption/Nutrition/Food Safety, Industrial Organization,
    Date: 2008–10
  6. By: Hyytiainen, Kari; Ahtiainen, Heini; Heikkila, Jaakko; Helin, Janne; Huhtala, Anni; Iho, Antti; Koikkalainen, Kauko; Miettinen, Antti; Pouta, Eija; Vesterinen, Janne
    Abstract: This study introduces a prototype model for evaluating policies to abate agricultural nutrients in the Baltic Sea from a Finnish national point of view. The stochastic simulation model integrates nutrient dynamics of nitrogen and phosphorus in the sea basins adjoining the Finnish coast, nutrient loads from land and other sources, benefits from nutrient abatement (in the form of recreation and other ecosystem services) and the costs of agricultural abatement activities. The aim of this study is to present the overall structure of the model and to demonstrate its potential using preliminary parameters. The model is made flexible for further improvements in all of its ecological and economic components. Results of a sensitivity analysis suggest that investments in reducing the nutrient runoff from arable land in Finland would become profitable only if Finlandâs neighbors in the northern Baltic committed themselves to similar reductions. Environmental investments for improving water quality yield the highest returns for the Bothnian Bay and the Gulf of Finland, and smaller returns for the Bothnian Sea. In the Bothnian Bay, the abatement activities become profitable because the riverine loads from Finland represent a high proportion of the total nutrient loads. In the Gulf of Finland, this proportion is low, but the size of the coastal population benefiting from improved water quality is high.
    Keywords: ecosystem services, nutrient abatement, Monte Carlo simulation, recreation, valuation, Environmental Economics and Policy, Research Methods/ Statistical Methods,
    Date: 2009–04
  7. By: Susan Thorp; Hardy Hulley; Rebecca McKibbin; Andreas Pedersen
    Abstract: We investigate the impact of means tested public income transfers on post-retirement decumulation and portfolio choice using theoretical simulations and panel data on Australian Age Pensioners. Means tested public pension payments in Australia have broad coverage and give insight into the incentive responsiveness of well-off, as well as poorer households. Via numerical solutions to a discrete time, fi?nite horizon dynamic programming problem, we simulate the optimal consumption and portfolio allocation strategies for a retired household subject to assets and income tests. Relative to benchmark, means tested households should optimally decumulate faster early in retirement, and choose more risky portfolios. Panel data tests on inferred wealth for pensioner households show evidence of more rapid spending early in retirement. However they also show that better-off households continue to accumulate, even when facing a steeper implicit tax rate on wealth than applies to poorer households. Wealthier households also hold riskier portfolios. Results from tests for Lorenz dominance of the panel wealth distribution show no decrease in wealth inequality over the fi?ve years of the study.
    JEL: D91 E21 G11
    Date: 2009–04

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