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Aggregation in models for natural resource policy analysis

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  • Atwood, Jay Dee

Abstract

The aggregation and behavioral implications of using a system of national and regional natural resource policy models together are examined. It is shown that the linearity and homogeneity conditions which guarantee aggregation consistency (and which are often employed in this type of model for specification and application ease) result in behavioral inconsistency for regional and national models. First, theoretical results on aggregation theory are organized in a form where implications relative to natural resource models are made accessible. Secondly, pragmatic efforts used to partially overcome the consistency problem are reviewed and critiqued. Thirdly, some theoretical model examples are developed to illustrate guidelines which can be followed in minimizing inconsistency. Finally, two existing models are applied to an empirical problem to illustrate concepts of the study.

Suggested Citation

  • Atwood, Jay Dee, 1989. "Aggregation in models for natural resource policy analysis," ISU General Staff Papers 198901010800009911, Iowa State University, Department of Economics.
    • Handle: RePEc:isu:genstf:198901010800009911
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