Designing Efficient Policies in a Regional Economy. A MCDM-CGE Approach

Francisco André and Manuel Alejandro Cardenete ()

No E2006/03, Economic Working Papers at Centro de Estudios Andaluces from Centro de Estudios Andaluces

Abstract: Since policy makers usually pursue several conflicting objectives, policy making can be understood as a multicriteria decision problem. Following the methodological proposal in André and Cardenete (2005), we use multiobjective programming in connection with a computable general equilibrium model to represent optimal policy making and to get so-called efficient policies in an application to a regional economy (Andalusia, Spain). We illustrate the solution of two bicriteria problems (unemployment vs. inflation and growth vs. unemployment) from which we get a new reading of two classical results: the Phillips curve and the Okun law. Finally, we enlarge the scope of the exercise by solving a problem with five objectives and discuss the efficient solutions that can be obtained in this context.

Keywords: Public Policy; Multicriteria Decision Making; Computable General Equilibrium Model; Efficient Policy. (search for similar items in EconPapers)
JEL-codes: C61 C68 D78 (search for similar items in EconPapers)
Pages: 28 pages
Date: 2006
New Economics Papers: this item is included in nep-cmp and nep-geo
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:cea:doctra:e2006_03

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