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Global Impact of Energy Use in Middle East Oil Economies: A Modeling Framework for Analyzing Technology-Energy-Environment-Economy Chain

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  • Hodjat Ghadimi

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    (Design & Merchandising, West Virginia University)

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    Abstract

    To explore choices of improving energy efficiency in energy-rich countries of the Middle East, this study lays out an integrated modeling framework for analyzing the technology-energy-environment-economy chain for the case of an energy exporting country. This framework consists of an input output process-flow model (IOPM) and a computable general equilibrium (CGE) model. The former investigates the micro-level production processes and sectoral interdependencies to show how alternative technologies affect the energy intensity of the economy (Lin, Polenske 1998 and Polenske, McMichael 2002). The latter belongs to the optimal depletion category of CGE models that analyzes energy economy interaction; it is an optimization model that solves the inter-temporal resource depletion problem subject to the workings of a multi-sector market economy, where relative prices play a crucial role (Ghadimi 1995, 2006). Such a formulation provides a systematic framework for analyzing the technology-energy-environment-economy chain in resource-rich developing countries. The main focus of this paper is to describe the theoretical structure of the class of CGE model proposed for this modeling framework.

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    File URL: http://rri.wvu.edu/wp-content/uploads/2012/11/wpghadimi2007-51.pdf
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    Bibliographic Info

    Paper provided by Regional Research Institute, West Virginia University in its series Working Papers with number 200705.

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    Length: 21 pages
    Date of creation: 2007
    Date of revision:
    Handle: RePEc:rri:wpaper:200705

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    Keywords: energy use; middle East; input-output; computable general equilibrium; cge;

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    References

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    1. Bergman, Lars, 1988. "Energy Policy Modeling: A survey of general equilibrium approaches," Journal of Policy Modeling, Elsevier, vol. 10(3), pages 377-399.
    2. McFarland, J. R. & Reilly, J. M. & Herzog, H. J., 2004. "Representing energy technologies in top-down economic models using bottom-up information," Energy Economics, Elsevier, vol. 26(4), pages 685-707, July.
    3. Devarajan, Shantayanan, 1988. "Natural resources and taxation in computable general equilibrium models of developing countries," Journal of Policy Modeling, Elsevier, vol. 10(4), pages 505-528.
    4. Dellink, Rob & van Ierland, Ekko, 2006. "Pollution abatement in the Netherlands: A dynamic applied general equilibrium assessment," Journal of Policy Modeling, Elsevier, vol. 28(2), pages 207-221, February.
    5. Bergman, Lars, 1990. "Energy and environmental constraints on growth: A CGE modeling approach," Journal of Policy Modeling, Elsevier, vol. 12(4), pages 671-691.
    6. Hodjat Ghadimi, 2006. "A Dynamic CGE Analysis of Exhaustible Resources: The Case of an Oil Exporting Developing Country," Working Papers 200607, Regional Research Institute, West Virginia University.
    7. Longva, Svein & Olsen, Oystein, 1983. " Price Sensitivity of Energy Demand in Norwegian Industries," Scandinavian Journal of Economics, Wiley Blackwell, vol. 85(1), pages 17-36.
    8. Despotakis, Kostas A. & Fisher, Anthony C., 1988. "Energy in a regional economy: A computable general equilibrium model for california," Journal of Environmental Economics and Management, Elsevier, vol. 15(3), pages 313-330, September.
    9. Polenske, Karen R. & McMichael, Francis C., 2002. "A Chinese cokemaking process-flow model for energy and environmental analyses," Energy Policy, Elsevier, vol. 30(10), pages 865-883, August.
    10. Aarrestad, Jostein, 1978. "Optimal savings and exhaustible resource extraction in an open economy," Journal of Economic Theory, Elsevier, vol. 19(1), pages 163-179, October.
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