IDEAS home Printed from https://ideas.repec.org/a/oup/apecpp/v33y2011i4p623-638.html
   My bibliography  Save this article

Comparing the Economic Impact of an Export Shock in Two Modeling Frameworks

Author

Listed:
  • Andrew J. Cassey
  • David W. Holland
  • Abdul Razack

Abstract

Because of more restrictive assumptions on regional input-output (IO) models compared to computable general equilibrium (CGE) models, IO results are thought to be consistent with long-run equilibrium but otherwise overestimated. We compare IO and CGE models' response to a shock to Washington crop exports under various labor market and capital closures. Contrary to conventional wisdom, we find that the positive secondary impacts are larger in the CGE models than in the IO model. Also contrary to conventional wisdom, we find that the closest match between direct effects is when the CGE model has short run, rather than long run restrictions. Copyright 2011, Oxford University Press.

Suggested Citation

  • Andrew J. Cassey & David W. Holland & Abdul Razack, 2011. "Comparing the Economic Impact of an Export Shock in Two Modeling Frameworks," Applied Economic Perspectives and Policy, Agricultural and Applied Economics Association, vol. 33(4), pages 623-638.
    • Handle: RePEc:oup:apecpp:v:33:y:2011:i:4:p:623-638
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1093/aepp/ppr033
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

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

    Other versions of this item:

    References listed on IDEAS

    as
    1. Christine Wieck & David Holland, 2010. "The economic effect of the Canadian BSE outbreak on the US economy," Applied Economics, Taylor & Francis Journals, vol. 42(8), pages 935-946.
    2. Mark Partridge & Dan Rickman, 2010. "Computable General Equilibrium (CGE) Modelling for Regional Economic Development Analysis," Regional Studies, Taylor & Francis Journals, vol. 44(10), pages 1311-1328.
    3. Sherman Robinson, 2006. "Macro Models and Multipliers: Leontief, Stone, Keynes, and CGE Models," Economic Studies in Inequality, Social Exclusion, and Well-Being, in: Alain Janvry & Ravi Kanbur (ed.), Poverty, Inequality and Development, chapter 0, pages 205-232, Springer.
    4. Alain Janvry & Ravi Kanbur (ed.), 2006. "Poverty, Inequality and Development," Economic Studies in Inequality, Social Exclusion, and Well-Being, Springer, number 978-0-387-29748-4, July.
    5. Mark D. Partridge & Dan S. Rickman, 1998. "Regional Computable General Equilibrium Modeling: A Survey and Critical Appraisal," International Regional Science Review, , vol. 21(3), pages 205-248, December.
    6. Dan S. Rickman, 2002. "A Bayesian forecasting approach to constructing regional input-output based employment multipliers," Papers in Regional Science, Springer;Regional Science Association International, vol. 81(4), pages 483-498.
    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. Hussain, Anwar & Munn, Ian A. & Holland, David W. & Armstrong, James & Spurlock, Stanley R., 2012. "Economic Impact of Wildlife-Associated Recreation Expenditures in the Southeast United States: A General Equilibrium Analysis," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 44(1), pages 1-20, February.
    2. Laurent Scaringella & Jean-Jacques Chanaron, 2016. "Grenoble–GIANT Territorial Innovation Models," Post-Print hal-01472878, HAL.
    3. Logar, Ivana & van den Bergh, Jeroen C.J.M., 2013. "The impact of peak oil on tourism in Spain: An input–output analysis of price, demand and economy-wide effects," Energy, Elsevier, vol. 54(C), pages 155-166.
    4. repec:zna:indecs:v:13:y:2015:i:2:p:434-449 is not listed on IDEAS
    5. Cassey, Andrew J. & Galinato, Suzette P. & Taylor, Justin L., 2012. "Environmental Regulation and Regional Economy: Economic Impacts of the Elimination of Azinphos-methyl on the Apple Industry and Washington State," Journal of Food Distribution Research, Food Distribution Research Society, vol. 43(2), pages 1-22.
    6. Andrew J. Cassey, 2011. "State Foreign Export Patterns," Southern Economic Journal, John Wiley & Sons, vol. 78(2), pages 308-329, October.
    7. Xi He, 2020. "US agricultural exports and labor market adjustments," Agricultural Economics, International Association of Agricultural Economists, vol. 51(4), pages 609-621, July.
    8. Helena Miloloza, 2015. "Distance Factors and Croatian Export Obstacles in the EU15: CAGE Approach," Interdisciplinary Description of Complex Systems - scientific journal, Croatian Interdisciplinary Society Provider Homepage: http://indecs.eu, vol. 13(3), pages 434-449.
    9. Scaringella, Laurent & Chanaron, Jean-Jacques, 2016. "Grenoble–GIANT Territorial Innovation Models: Are investments in research infrastructures worthwhile?," Technological Forecasting and Social Change, Elsevier, vol. 112(C), pages 92-101.
    10. Miloloža Helena, 2015. "Differences between Croatia and EU Candidate Countries: the CAGE Distance Framework," Business Systems Research, Sciendo, vol. 6(2), pages 52-62, September.
    11. Laurent Scaringella & Jean-Jacques Chanaron, 2016. "Grenoble–GIANT Territorial Innovation Models," Grenoble Ecole de Management (Post-Print) hal-01472878, HAL.
    12. Watson, Philip S. & Castelin, Kimberly & Salant, Priscilla & Wulfhorst, J.D., 2012. "Estimating the Impacts of a Reduction in the Foreign-born Labor Supply on a State Economy: A Nested CGE Analysis of the Idaho Economy," The Review of Regional Studies, Southern Regional Science Association, vol. 42(1), pages 51-74, Spring.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Philip B. Whyman, 2018. "The local economic impact of shale gas extraction," Regional Studies, Taylor & Francis Journals, vol. 52(2), pages 184-196, February.
    2. Chang Seung & Edward Waters, 2010. "Evaluating Supply-Side And Demand-Side Shocks For Fisheries: A Computable General Equilibrium (Cge) Model For Alaska," Economic Systems Research, Taylor & Francis Journals, vol. 22(1), pages 87-109.
    3. Hodjat Ghadimi, 2008. "Energy in a Resource-based Regional Economy: A Dynamic General Equilibrium Analysis," Working Papers Working Paper 2008-02, Regional Research Institute, West Virginia University.
    4. Mark Partridge & Dan Rickman, 2010. "Computable General Equilibrium (CGE) Modelling for Regional Economic Development Analysis," Regional Studies, Taylor & Francis Journals, vol. 44(10), pages 1311-1328.
    5. Konstantinos Pouliakas & Deborah Roberts & Eudokia Balamou & Dimitris Psaltopoulos, 2014. "Modelling the Effects of Immigration on Regional Economic Performance and Wage Distribution: A Computable General Equilibrium (CGE) Analysis of Three European Union Regions," Regional Studies, Taylor & Francis Journals, vol. 48(2), pages 318-338, February.
    6. James A. Giesecke & John R. Madden, 2013. "Evidence-based regional economic policy analysis: the role of CGE modelling," Cambridge Journal of Regions, Economy and Society, Cambridge Political Economy Society, vol. 6(2), pages 285-301.
    7. Hermannsson, Kristinn & Lisenkova, Katerina & Lecca, Patrizio & McGregor, Peter G & Swales, J Kim, 2010. "The Importance of Graduates for the Scottish Economy: A Micro-to-Macro Approach," SIRE Discussion Papers 2010-80, Scottish Institute for Research in Economics (SIRE).
    8. Hakan Yilmazkuday, 2017. "Individual tax rates and regional tax revenues: a cross-state analysis," Regional Studies, Taylor & Francis Journals, vol. 51(5), pages 701-711, May.
    9. Gilmartin, Michelle & Swales, Kim J. & Turner, Karen, 2008. "A comparison of results from MRIO and interregional computable general equilibrium (CGE) analyses of the impacts of a positive demand shock on the ‘CO2 trade balance’ between Scotland and the rest," SIRE Discussion Papers 2008-24, Scottish Institute for Research in Economics (SIRE).
    10. Dixon, Peter B. & Rimmer, Maureen T., 2011. "You can't have a CGE recession without excess capacity," Economic Modelling, Elsevier, vol. 28(1-2), pages 602-613, January.
    11. Cui, Cathy Xin & Ha, Soo Jung & Hanley, Nicholas & McGregor, Peter G & Turner, Karen & Yin, Ya Ping, 2011. "Productivity Growth, Decoupling and Pollution Leakage," Stirling Economics Discussion Papers 2011-13, University of Stirling, Division of Economics.
    12. Lecca, Patrizio & McGregor, Peter G. & Swales, J. Kim, 2013. "Forward-looking and myopic regional Computable General Equilibrium models: How significant is the distinction?," Economic Modelling, Elsevier, vol. 31(C), pages 160-176.
    13. Ioannis Charalampidis & Panagiotis Karkatsoulis & Pantelis Capros, 2019. "A Regional Economy-Energy-Transport Model of the EU for Assessing Decarbonization in Transport," Energies, MDPI, vol. 12(16), pages 1-27, August.
    14. Haitao Yu, 2018. "A review of input–output models on multisectoral modelling of transportation–economic linkages," Transport Reviews, Taylor & Francis Journals, vol. 38(5), pages 654-677, September.
    15. Turner, Karen & Munday, Max & McGregor, Peter & Swales, Kim, 2012. "How responsible is a region for its carbon emissions? An empirical general equilibrium analysis," Ecological Economics, Elsevier, vol. 76(C), pages 70-78.
    16. Soo Ha & J. Swales, 2012. "The export-base model with a supply-side stimulus to the export sector," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 49(2), pages 323-353, October.
    17. 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.
    18. Ghaith, Ziad & Kulshreshtha, Suren & Natcher, David & Cameron, Bobby Thomas, 2021. "Regional Computable General Equilibrium models: A review," Journal of Policy Modeling, Elsevier, vol. 43(3), pages 710-724.
    19. Turner, Karen & Hanley, Nick, 2009. "How do improvements in labour productivity in the Scottish economy affect the UK position on the Environmental Kuznets Curve?," SIRE Discussion Papers 2009-34, Scottish Institute for Research in Economics (SIRE).
    20. Michelle Gilmartin & Peter McGregor & Kim Swales & Karen Turner, 2009. "The added value from adopting a CGE approach to analyse changes in environmental trade balances," Working Papers 0903, University of Strathclyde Business School, Department of Economics.

    More about this item

    JEL classification:

    • C67 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Input-Output Models
    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • R13 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General Equilibrium and Welfare Economic Analysis of Regional Economies
    • R15 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Econometric and Input-Output Models; Other Methods

    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:oup:apecpp:v:33:y:2011:i:4:p:623-638. See general information about how to correct material in RePEc.

    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 bibliographic 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.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Oxford University Press (email available below). General contact details of provider: https://edirc.repec.org/data/aaeaaea.html .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.