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Forward-looking and myopic regional Computable General Equilibrium models: How significant is the distinction?

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  • Lecca, Patrizio
  • McGregor, Peter G.
  • Swales, J. Kim

Abstract

We present a stylized intertemporal forward-looking model that accommodates key regional economic features, an area where the literature is not well developed. The main difference, from the standard applications, is the role of saving and its implication for the balance of payments. Though maintaining dynamic forward-looking behaviour for agents, the rate of private saving is exogenously determined and so no neoclassical financial adjustment is needed. Also, we focus on the similarities and the differences between myopic and forward-looking models, highlighting the divergences amongst the main adjustment equations and the resulting simulation outcomes.

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Bibliographic Info

Article provided by Elsevier in its journal Economic Modelling.

Volume (Year): 31 (2013)
Issue (Month): C ()
Pages: 160-176

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Handle: RePEc:eee:ecmode:v:31:y:2013:i:c:p:160-176

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Web page: http://www.elsevier.com/locate/inca/30411

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Keywords: Myopic and forward-looking behaviour; Computable General Equilibrium models; Regional adjustment;

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Citations

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Cited by:
  1. Allan, Grant & Lecca, Patrizio & McGregor, Peter & Swales, Kim, 2014. "The economic and environmental impact of a carbon tax for Scotland: A computable general equilibrium analysis," Ecological Economics, Elsevier, vol. 100(C), pages 40-50.
  2. Patrizio, Lecca & Peter G., McGregor & J. Kim, Swales & Karen, Turner, 2013. "The added value from a general equilibrium analyses of increased efficiency in household energy use," SIRE Discussion Papers 2013-39, Scottish Institute for Research in Economics (SIRE).
  3. Patrizio Lecca & Peter McGregor & Kim Swales, 2010. "Balanced Budget Government Spending in a Small Open Regional Economy," Working Papers 1020, University of Strathclyde Business School, Department of Economics.
  4. Garau, Giorgio & Lecca, Patrizio & Mandras, Giovanni, 2013. "The impact of population ageing on energy use: Evidence from Italy," Economic Modelling, Elsevier, vol. 35(C), pages 970-980.

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