Insights from adding transportation sector detail into an economy-wide model: The case of the ADAGE CGE model

Yongxia Cai, Jared Woollacott, Robert Beach, Lauren E. Rafelski, Christopher Ramig and Michael Shelby

Energy Economics, 2023, vol. 123, issue C

Abstract: Computable general equilibrium (CGE) models provide valuable insights into economy-wide impacts of anticipated future structural changes in the transportation sector, yet few CGE models offer detailed transportation representations. We use an enhanced Applied Dynamic Analysis of the Global Economy (ADAGE) CGE model to incorporate disaggregated transportation modes and technologies in on-road passenger and freight transportation. We assess the impacts of these inclusions on U.S. transportation patterns, energy consumption and greenhouse gas emissions. Simulating illustrative global oil price cases with and without transportation detail, we find subsector mode disaggregation and technology additions in a CGE model significantly alter the impacts of oil prices on global trade and freight patterns, energy consumption, and greenhouse gas (GHG) emissions. We find that: (1) alternative technologies are essential for capturing transportation sector impacts, (2) electrification may reduce emissions with electricity decarbonization, and (3) higher oil prices may hasten electrification.

Keywords: Alternative-fuel vehicles; Economic modeling; Oil price; Transportation policy (search for similar items in EconPapers)
Date: 2023
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Working Paper: Insights from Adding Transportation Sector Detail into an Economy-Wide Model: The Case of the ADAGE CGE Model (2022)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:123:y:2023:i:c:s0140988323002086

DOI: 10.1016/j.eneco.2023.106710

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