gemInputOutputTable_2_7_2: A Two-Country General Equilibrium Model

In GE: General Equilibrium Modeling

A Two-Country General Equilibrium Model

Description

A two-country general equilibrium model. This general equilibrium model is based on a two-country (i.e. CHN and ROW) input-output table consisting of an input part and an output part. Each country contains 2 sectors and 7 commodities (or subjects). The 2 sectors are firm and household. The 7 commodities (or subjects) are product, labor, capital goods, bond, tax, dividend, tariff. Hence the input-output table has 14 rows and 4 columns.

Usage

gemInputOutputTable_2_7_2(
  IT,
  OT,
  es.DIProduct.firm.CHN = 3,
  es.DIProduct.firm.ROW = 3,
  es.laborCapital.firm.CHN = 0.75,
  es.laborCapital.firm.ROW = 0.75,
  es.household.CHN = 3,
  es.household.ROW = 3,
  return.dstl = FALSE,
  ...
)

Arguments

IT	the input part of the input-output table.
OT	the output part of the input-output table.
es.DIProduct.firm.CHN	the elasticity of substitution between domestic product and imported product used by the production sector of CHN.
es.DIProduct.firm.ROW	the elasticity of substitution between domestic product and imported product used by the production sector of ROW.
es.laborCapital.firm.CHN	the elasticity of substitution between labor and capital goods used by the production sector of CHN.
es.laborCapital.firm.ROW	the elasticity of substitution between labor and capital goods used by the production sector of ROW.
es.household.CHN	the elasticity of substitution between domestic product and imported product used by the consumption sector of CHN.
es.household.ROW	the elasticity of substitution between domestic product and imported product used by the consumption sector of ROW.
return.dstl	If TRUE, the demand structure tree will be returned.
...	arguments to be transferred to the function sdm2.

Value

A general equilibrium, which usually is a list with the following elements:

• p - the price vector with CHN labor as numeraire.

• dstl - the demand structure tree list of sectors if return.dstl == TRUE.

• ... - some elements returned by the function sdm2.

Examples

IT <- matrix(c(
  142, 84, 13, 4.1,
  47, 0, 0, 0,
  13, 0, 0, 0,
  0, 0, 0, 3.4,
  9.3, 0, 0, 0,
  22, 0, 0, 0,
  0.15, 0.091, 0, 0,
  10, 6, 381, 451,
  0, 0, 252, 0,
  0, 0, 81, 0,
  0, 4.9, 0, 0,
  0, 0, 26, 0,
  0, 0, 92, 0,
  0, 0, 1.9, 0.59
), 14, 4, TRUE)

OT <- matrix(c(
  244, 0, 0, 0,
  0, 47, 0, 0,
  0, 13, 0, 0,
  0, 3.4, 0, 0,
  0, 9.3, 0, 0,
  0, 22, 0, 0,
  0, 0.24, 0, 0,
  0, 0, 849, 0,
  0, 0, 0, 252,
  0, 0, 0, 81,
  0, 0, 0, 4.9,
  0, 0, 0, 26,
  0, 0, 0, 92,
  0, 0, 0, 2.5
), 14, 4, TRUE)

dimnames(IT) <- dimnames(OT) <- list(
  c(
    "product.CHN", "labor.CHN", "capital.CHN", "bond.CHN",
    "tax.CHN", "dividend.CHN", "tariff.CHN",
    "product.ROW", "labor.ROW", "capital.ROW", "bond.ROW",
    "tax.ROW", "dividend.ROW", "tariff.ROW"
  ),
  c(
    "firm.CHN", "household.CHN",
    "firm.ROW", "household.ROW"
  )
)

ge <- gemInputOutputTable_2_7_2(IT, OT, return.dstl = TRUE)
ge$p
ge$z
node_plot(ge$dstl[[1]])
ge$dstl[[1]]$a

## tariff rate change in CHN
dstl <- lapply(ge$dstl, Clone)
tmp <- node_set(dstl[[1]], "cc1.1")
tmp$beta[2] <- tmp$beta[2] * 10

ge.TRC <- sdm2(
  A = dstl, B = ge$B, S0Exg = ge$S0Exg,
  names.commodity = rownames(ge$B),
  names.agent = colnames(ge$B),
  numeraire = "labor.CHN"
)

ge.TRC$p
ge.TRC$z
#### technology progress in CHN
OT.TP <- OT
OT.TP["product.CHN", "firm.CHN"] <- OT["product.CHN", "firm.CHN"] * 1.2

ge.TP <- gemInputOutputTable_2_7_2(IT, OT.TP, return.dstl = TRUE)
ge.TP$p
ge.TP$z
ge.TP$dstl[[1]]$a

#### capital accumulation in CHN
OT.CA <- OT
OT.CA["capital.CHN", "household.CHN"] <- OT["capital.CHN", "household.CHN"] * 2

ge.CA <- gemInputOutputTable_2_7_2(IT, OT.CA)
ge.CA$p
ge.CA$z

#### labor supply change in CHN
OT.LSC <- OT
OT.LSC["labor.CHN", "household.CHN"] <- OT["labor.CHN", "household.CHN"] * 0.5

ge.LSC <- gemInputOutputTable_2_7_2(IT, OT.LSC)
ge.LSC$p
ge.LSC$z

GE documentation built on Nov. 8, 2023, 9:07 a.m.