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Disaggregation of results from a detailed general equilibrium model of the US to the State level

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  • Peter B. Dixon
  • Maureen T. Rimmer

Abstract

This paper describes the regional extension of USAGE-ITC, a 500-order dynamic CGE model of the US that we are developing in collaboration with the International Trade Commission. With the regional extension, USAGE-ITC can project the effects on employment and output by state of policy and other shocks to the economy. The paper describes the theory and data underlying the regional extension, and provides an illustrative application concerned with the effects of elimination of US restraints on imports. In CGE modeling there are two broad approaches to generating regional results: bottoms-up and tops-down. Our approach here is tops-down with emphasis on the estimation of inter-regional flows of goods and services. As explained in the paper, the tops-down approach is adequate for analysis of economy-wide shocks such as changes in Federal policies. Bottoms-up modeling will be required for analysis of shocks in which the essence is a change in relative costs across regions.

Suggested Citation

  • Peter B. Dixon & Maureen T. Rimmer, 2004. "Disaggregation of results from a detailed general equilibrium model of the US to the State level," Centre of Policy Studies/IMPACT Centre Working Papers g-145, Victoria University, Centre of Policy Studies/IMPACT Centre.
    • Handle: RePEc:cop:wpaper:g-145
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    1. Dixon, P.B. & Parmenter, B.R. & Sutton, J., 1978. "Spatial Disaggregation of Orani Results: A Preliminary Analysis of the Impact of Protection at the State Level," Economic Analysis and Policy, Elsevier, vol. 8(1), pages 35-86.
    2. Naqvi, Farzana & Peter, Matthew W, 1996. "A Multiregional, Multisectoral Model of the Australian Economy with an Illustrative Application," Australian Economic Papers, Wiley Blackwell, vol. 35(66), pages 94-113, June.
    3. Pearson, K. R., 1988. "Automating the computation of solutions of large economic models," Economic Modelling, Elsevier, vol. 5(4), pages 385-395, October.
    4. Hertel, Thomas, 1997. "Global Trade Analysis: Modeling and applications," GTAP Books, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University, number 7685, December.
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    Cited by:

    1. Peter B. Dixon & Maureen T. Rimmer & Marinos E. Tsigas, 2004. "Macro, industry and state effects in the U.S. of removing major tariffs and quotas," Centre of Policy Studies/IMPACT Centre Working Papers g-146, Victoria University, Centre of Policy Studies/IMPACT Centre.
    2. Faria, Weslem & Haddad, Eduardo, 2011. "Estimação das Elasticidades de Substituição do Comércio Regional do Brasil," TD NEREUS 1-2011, Núcleo de Economia Regional e Urbana da Universidade de São Paulo (NEREUS).
    3. Fernando Salgueiro Perobelli & Eduardo Amaral Haddad & Jaime Bonet Moron & Geoffrey Hewings, 2010. "Structural Interdependence Among Colombian Departments," Economic Systems Research, Taylor & Francis Journals, vol. 22(3), pages 279-300.
    4. R. Azzoni, Carlos & A. Haddad, Eduardo & P. Domingues, Edson & Perobelli, Fernando, 2005. "Using interregional Multipliers to Compute the Efficiency-equity Trade-off at the Sub-national level: an Application to a Brazilian State," TD NEREUS 11-2005, Núcleo de Economia Regional e Urbana da Universidade de São Paulo (NEREUS).
    5. Eduardo Haddad & Juan Manuel Samaniego & Alexandre Porsse & Santiago Ochoa & Luiz Gustavo Souza, 2011. "Interregional Interdependence among Ecuadorian Provinces: An Input-Output Analysis," ERSA conference papers ersa11p836, European Regional Science Association.
    6. Amaral Haddad, Eduardo & Cotarelli, Natália & Simonato, Thiago & Vale, Vinicius & Coelho Visentin, Jaqueline, 2018. "Estimation of NUTS2 Interregional Input-Output Systems for Greece, 2010 and 2013," TD NEREUS 3-2018, Núcleo de Economia Regional e Urbana da Universidade de São Paulo (NEREUS).
    7. Eduardo Haddad & Vasco Silva & Alexandre Porsse & Tomaz Dentinho, 2015. "Multipliers in an Island Economy: The Case of the Azores," World Scientific Book Chapters, in: Amitrajeet A Batabyal & Peter Nijkamp (ed.), THE REGION AND TRADE New Analytical Directions, chapter 8, pages 205-226, World Scientific Publishing Co. Pte. Ltd..
    8. Lucas Hahn de Castro, 2016. "Encadenamientos regionales en Colombia 2004-2012," Revista de Economía del Rosario, Universidad del Rosario, vol. 19(1), pages 29-56, June.
    9. Eduardo Haddad & Weslem Faria & Luis Armando Galvis-Aponte & Lucas Wilfried Hahn-De-Castro, 2016. "Matriz insumo-producto interregional para Colombia, 2012," Documentos de Trabajo Sobre Economía Regional y Urbana 15140, Banco de la República, Economía Regional.
    10. Eduardo A. Haddad & Inácio F. Araújo, 2021. "The internal geography of services value‐added in exports: A Latin American perspective," Papers in Regional Science, Wiley Blackwell, vol. 100(3), pages 713-744, June.
    11. 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.
    12. Haddad, Eduardo, 2012. "Progress on the Development of an Interregional Computable General Equilibrium Model for Lebanon: The Input-Output System," TD NEREUS 1-2012, Núcleo de Economia Regional e Urbana da Universidade de São Paulo (NEREUS).
    13. Eduardo Amaral Haddad & Weslem Rodrigues Faria & Luis Armando Galvis-Aponte & Lucas Wilfried Hahn-De-Castro, 2016. "Interregional Input-Output Matrix for Colombia, 2012," Borradores de Economia 14203, Banco de la Republica.
    14. Haddad, Eduardo & García-Samaniego, Juan Manuel & Porsse, Alexandre & Jimenez, Diego & Moreno, Wilman & de Souza, Luiz Gustavo, 2011. "Interregional Input-Ouptut System for Ecuador, 2007: Methodology and Results," TD NEREUS 3-2011, Núcleo de Economia Regional e Urbana da Universidade de São Paulo (NEREUS).
    15. Amaral Haddad, Eduardo & Fernandes de Araújo, Inácio & Ibarraran, María Eugenia & Boyd, Roy & Elizondo, Alejandra & Liedo-Orozco, Pedro & Menchero-Garcia, Mariana & Belausteguigoitia, Juan Carlos, 2019. "Interregional Input-Output System for Mexico, 2013," TD NEREUS 7-2019, Núcleo de Economia Regional e Urbana da Universidade de São Paulo (NEREUS).
    16. Giesecke, James A. & Madden, John R., 2013. "Regional Computable General Equilibrium Modeling," Handbook of Computable General Equilibrium Modeling, in: Peter B. Dixon & Dale Jorgenson (ed.), Handbook of Computable General Equilibrium Modeling, edition 1, volume 1, chapter 0, pages 379-475, Elsevier.
    17. Pham Van Ha & Hoa Thi Minh Nguyen & Tom Kompas & Tuong Nhu Che & Bui Trinh, 2015. "Rice Production, Trade and the Poor: Regional Effects of Rice Export Policy on Households in Vietnam," Journal of Agricultural Economics, Wiley Blackwell, vol. 66(2), pages 280-307, June.
    18. Hasegawa, Marcos & Guilhoto, Joaquim José Martins, 2006. "Investimento e produtividade dos fatores primários: uma análise de equilíbrio geral aplicado [Investment and productivity of primary factors: a general applied general equilibrium analysis]," MPRA Paper 54555, University Library of Munich, Germany.
    19. Peter B. Dixon & Maureen T. Rimmer & Marinos E. Tsigas, 2007. "Regionalising results from a detailed CGE model: Macro, industry and state effects in the U.S. of removing major tariffs and quotas," Papers in Regional Science, Wiley Blackwell, vol. 86(1), pages 31-55, March.
    20. Gabela, Julio Gustavo Fournier, 2020. "On the accuracy of gravity-RAS approaches used for inter-regional trade estimation: evidence using the 2005 inter-regional input–output table of Japan," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 32(4), pages 521-539.
    21. J.A. Giesecke & P.B. Dixon & M.T. Rimmer & N.H. Tran & D. Pratap, 2020. "The Effects on the Indian Economy of an Expansion in Financial Capital Supply," Centre of Policy Studies/IMPACT Centre Working Papers g-308, Victoria University, Centre of Policy Studies/IMPACT Centre.

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    More about this item

    JEL classification:

    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
    • F14 - International Economics - - Trade - - - Empirical Studies of Trade
    • R1 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics

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