IDEAS home Printed from https://ideas.repec.org/a/eee/ecmode/v38y2014icp238-245.html
   My bibliography  Save this article

Model structure or data aggregation level: Which leads to greater bias of results?

Author

Listed:
  • Brockmeier, Martina
  • Bektasoglu, Beyhan

Abstract

The aim of this paper is to provide a first step toward a systematic sensitivity analysis of a system of linked models. We focus on two fundamental characteristics: the model structure and the data aggregation level. Employing the Global Trade Analysis Project (GTAP) framework, we combine the general equilibrium (GE) and partial equilibrium (PE) versions of the GTAP model, each of which is then run with a highly aggregated and a highly disaggregated version of the GTAP database. Based on this experimental setting, we quantify the biases resulting from the data aggregation, the model structure and the interaction of these two model characteristics. We conclude that data aggregation as well as the related false competition and tariff averaging influence the results significantly more than the model structure, whereas the bias stemming from the interaction of the two model characteristics is negligible.

Suggested Citation

  • Brockmeier, Martina & Bektasoglu, Beyhan, 2014. "Model structure or data aggregation level: Which leads to greater bias of results?," Economic Modelling, Elsevier, vol. 38(C), pages 238-245.
  • Handle: RePEc:eee:ecmode:v:38:y:2014:i:c:p:238-245 DOI: 10.1016/j.econmod.2014.01.003
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0264999314000066
    Download Restriction: Full text for ScienceDirect subscribers only

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. James E. Anderson & J. Peter Neary, 1996. "A New Approach to Evaluating Trade Policy," Review of Economic Studies, Oxford University Press, vol. 63(1), pages 107-125.
    2. Narayanan, Badri G. & Hertel, Thomas W. & Horridge, J. Mark, 2010. "Disaggregated data and trade policy analysis: The value of linking partial and general equilibrium models," Economic Modelling, Elsevier, vol. 27(3), pages 755-766, May.
    3. Anderson, James E & Neary, J Peter, 1994. "Measuring the Restrictiveness of Trade Policy," World Bank Economic Review, World Bank Group, vol. 8(2), pages 151-169, May.
    4. James E. Anderson & J. Peter Neary, 2003. "The Mercantilist Index of Trade Policy," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 44(2), pages 627-649, May.
    5. Jason H. Grant & Thomas W. Hertel & Thomas F. Rutherford, 2007. "Tariff line analysis of U.S. and international dairy protection," Agricultural Economics, International Association of Agricultural Economists, vol. 37(s1), pages 271-280, December.
    6. Alexandre Gohin & GianCarlo Moschini, 2006. "Evaluating the Market and Welfare Impacts of Agricultural Policies in Developed Countries: Comparison of Partial and General Equilibrium Measures," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 28(2), pages 195-211.
    7. Sebastian Hess & Stephan von Cramon-Taubadel, 2007. "Meta-analysis of general and partial equilibrium simulations of Doha Round outcomes," Agricultural Economics, International Association of Agricultural Economists, pages 281-286.
    8. Gylfason, T, 1995. "The Macroeconomics of European Agriculture," Princeton Studies in International Economics 78, International Economics Section, Departement of Economics Princeton University,.
    9. Charteris, Angus & Winchester, Niven, 2010. "Dairy disaggregation and joint production in an economy-wide model," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 54(4), December.
    10. Durand-Morat, Alvaro & Wailes, Eric J., 2005. "General and partial equilibrium analysis of the impact of the Central America Free Trade Agreement on the U.S. rice sector," 2005 Annual meeting, July 24-27, Providence, RI 19238, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    11. Narayanan, Badri & Thomas Hertel & Mark Horridge, 2010. "Linking Partial and General Equilibrium Models: A GTAP Application Using TASTE," GTAP Technical Papers 3192, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University.
    12. Pelikan, Janine & Brockmeier, Martina, 2008. "Methods to Aggregate Import Tariffs and their Impacts on Modeling Results," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 23, pages 685-708.
    13. Stephen Tokarick, 2003. "Measuring the Impact of Distortions in Agricultural Trade in Partial and General Equilibrium," IMF Working Papers 03/110, International Monetary Fund.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Britz, Wolfgang & van der Mensbrugghe, Dominique, 2016. "Reducing unwanted consequences of aggregation in large-scale economic models - A systematic empirical evaluation with the GTAP model," Economic Modelling, Elsevier, vol. 59(C), pages 463-472.
    2. Olexandr Nekhay & Manuel Alejandro Cardenete Flores & Adolfo Cristobal Campoamor & Olexandr Nekhay, 2016. "The EU-Ukraine Free Trade Agreement and Russia’s Retaliation: a Negative Side of Free Trade Agreements?," EcoMod2016 9326, EcoMod.
    3. Himics, Mihály & Britz, Wolfgang, 2016. "Flexible and welfare-consistent tariff aggregation over exporter regions," Economic Modelling, Elsevier, vol. 53(C), pages 375-387.

    More about this item

    Keywords

    System of linked models; Model structure; Aggregation level; False competition; Tariff aggregation; GTAP;

    JEL classification:

    • F13 - International Economics - - Trade - - - Trade Policy; International Trade Organizations
    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
    • Q17 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agriculture in International Trade

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:ecmode:v:38:y:2014:i:c:p:238-245. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Dana Niculescu). General contact details of provider: http://www.elsevier.com/locate/inca/30411 .

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.