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The economic impacts of a construction project, using SinoTERM, a multi-regional CGE model of China

  • Mark Horridge
  • Glyn Wittwer

The paper outlines the theory and database preparation of SinoTERM, a "bottom-up" computable general equilibrium model of the Chinese economy. The methodology by which we construct the multi-regional model allows us to present the economy of China in an unprecedented amount of detail. SinoTERM covers all 31 provinces and municipalities. The database of the model extends the published national input-output table for 2002 to 137 sectors. The single crops sector in the published national input-output table is split into 11 and the single livestock sector into 3. The multi-regional CGE model provides a framework that we could modify to apply to many different policy applications. We can use SinoTERM to analyse the regional economic impacts of region-specific shocks. Such shocks could major construction projects or investments in health and education sectors, in an effort to accelerate economic growth in the lagging inland provinces. We use a 63 sector, 10 region aggregation of the SinoTERM master database to model the regional economic impacts of the proposed Chongqing-Lichuan rail link construction project.

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Paper provided by Victoria University, Centre of Policy Studies/IMPACT Centre in its series Centre of Policy Studies/IMPACT Centre Working Papers with number g-164.

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Date of creation: Jun 2007
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Publication status: Published in China Economic Review, Vol.19, Issue 4, Dec. 2008, pp. 628-634.
Handle: RePEc:cop:wpaper:g-164
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