The purpose of this paper was threefold. First, we presented a flexible analytical framework, based on sound and consistent economic theory and data, in order to assess the likely state/sectoral/income effects of policy changes in Brazil. This is the first fully operational interstate CGE model implemented for the Brazilian economy, based on previous work by the author and associates. Among the features embedded in this framework, modeling of scale economies and transportation costs provides an innovative way of dealing explicitly with theoretical issues related to integrated regional systems. Results seemed to reinforce the need to better specifying spatial interactions in interregional CGE models. Second, in order to illustrate the analytical capability of the CGE module, we presented a simulation, which evaluated the regional impacts of a decrease in transportation costs, in accordance with recent policy developments in Brazil. Rather than providing a critical evaluation of this debate, we intended to emphasize the likely structural impacts of such policies. Third, previous diagnostics suggested the need to make a more in-depth analysis of trade flows between the Brazilian states, potentially leading to generalizations regarding the type of trade involved, changes in its composition through time as the Brazilian economy develops, and the implications of these structural differences in the coordination and implementation of development policies. In order to address this issue we gave interregional trade its proper place by taking into account a fully specified interstate system of accounts specially developed for the purpose of calibrating the CGE model.
Download Info
To download:
If you experience problems downloading a file, check if you have the
proper application to
view it first. Information about this may be contained
in the File-Format links below. In case of further problems read
the IDEAS help
page. Note that these files are not on the IDEAS
site. Please be patient as the files may be large.
Publisher Info
Paper provided by European Regional Science Association in its series ERSA conference papers with number
ersa04p461.
References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
Cited by: (explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)