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

Peter Dixon and Maureen Rimmer

Centre of Policy Studies/IMPACT Centre Working Papers from Victoria University, Centre of Policy Studies/IMPACT Centre

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.

JEL-codes: C68 D58 F14 R1 (search for similar items in EconPapers)
Date: 2004-04
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Citations: View citations in EconPapers (29)

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