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A dynamic general equilibrium model for tax policy analysis in Colombia


  • Thomas F. RUTHERFORD


  • Miles K. LIGHT


  • Gustavo Adolfo HERNANDEZ



The paper documents a dynamic general equilibrium model for Colombia based on national accounts from 1999. The paper is part of a project intended to develop a capacity for the the design, specification, and application of computable models within the Colombian Ministry of Finance and Department of National Planning. Our analytical framework includes both forwardlooking expectations and Harris-Todaro labor markets. In the present paper we compare numerical results from the dynamic model with simpler static and steady-state formulations to highlight the importance of transitional efects in evaluating tax policy reform. Our applications include measurement of the marginal cost of funds from di®erent tax bases and the evaluation of discrete changes in tari® structure. The structure of the labor and intermediate credit markets have important implications for the ranking alternative tax reform proposals.

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  • Thomas F. RUTHERFORD & Miles K. LIGHT & Gustavo Adolfo HERNANDEZ, 2002. "A dynamic general equilibrium model for tax policy analysis in Colombia," ARCHIVOS DE ECONOMÍA 001910, DEPARTAMENTO NACIONAL DE PLANEACIÓN.
  • Handle: RePEc:col:000118:001910

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    References listed on IDEAS

    1. Castro Carlos Alberto, 2001. "Eficiencia-X en el sector bancario colombiano," REVISTA DESARROLLO Y SOCIEDAD, UNIVERSIDAD DE LOS ANDES-CEDE, September.
    2. Rutherford, Thomas F, 1999. "Applied General Equilibrium Modeling with MPSGE as a GAMS Subsystem: An Overview of the Modeling Framework and Syntax," Computational Economics, Springer;Society for Computational Economics, vol. 14(1-2), pages 1-46, October.
    3. Juan Carlos ECHEVERRY GARZON, 2002. "El siglo del modelo de desarrollo," ARCHIVOS DE ECONOMÍA 002552, DEPARTAMENTO NACIONAL DE PLANEACIÓN.
    4. Ortega, Juan Ricardo & Piraquive, Gabriel Armando & Hernandez, Gustavo Adolfo & Soto, Carolina & Prada, Sergio & Ramirez, Juan Mauricio, 2000. "Incidencia fiscal de los incentivos tributarios
      [Fiscal Incidence of tax incentives]
      ," MPRA Paper 14016, University Library of Munich, Germany.
    5. Fernando MESA PARRA, 2001. "Strategic Trade Policy and Exchange Rate Uncertainty," ARCHIVOS DE ECONOMÍA 003527, DEPARTAMENTO NACIONAL DE PLANEACIÓN.
    6. Hernandez, Gustavo Adolfo & Light, Miles & Rutherford, Thomas, 2002. "A dynamic general equilibrium model for tax policy analysis in Colombia," MPRA Paper 28435, University Library of Munich, Germany.
    7. Thomas F. Rutherford & Miles K. LIGHT, 2002. "A General Equilibrium Model for Tax Policy Analysis in Colombia: The MEGATAX Model," ARCHIVOS DE ECONOMÍA 011291, DEPARTAMENTO NACIONAL DE PLANEACIÓN.
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    Cited by:

    1. Gustavo Adolfo HERNANDEZ DIAZ, 2011. "Impuestos parafiscales y mercado laboral: Un análisis de Equilibrio General Computable," ARCHIVOS DE ECONOMÍA 008954, DEPARTAMENTO NACIONAL DE PLANEACIÓN.
    2. Paula ACOSTA MARQUEZ, 2002. "Does corporate governance matter for developing countries? An overview of the Mexican case," ARCHIVOS DE ECONOMÍA 002380, DEPARTAMENTO NACIONAL DE PLANEACIÓN.
    3. Allan DRAZEN & Marcela ESLAVA, 2003. "The political business cycle in Colombia on the National and Regional level," ARCHIVOS DE ECONOMÍA 003616, DEPARTAMENTO NACIONAL DE PLANEACIÓN.
    4. Ömer Özak & Oscar Mauricio Valencia, 2002. "Impacto macroeconómico y distributivo del impuesto de seguridad democrática," ARCHIVOS DE ECONOMÍA 011294, DEPARTAMENTO NACIONAL DE PLANEACIÓN.
    5. Jaime Andrés ESTRADA, 2002. "Optimal enforcement: Finding the right balance," ARCHIVOS DE ECONOMÍA 003302, DEPARTAMENTO NACIONAL DE PLANEACIÓN.
    6. Takeda, Shiro, 2007. "The double dividend from carbon regulations in Japan," Journal of the Japanese and International Economies, Elsevier, vol. 21(3), pages 336-364, September.
    7. Carlos Alberto CASTRO IRAGORRI, 2003. "Yet another lagging, coincident and leading index for the Colombian economy," ARCHIVOS DE ECONOMÍA 003785, DEPARTAMENTO NACIONAL DE PLANEACIÓN.

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