CALIBRATION OF CES FUNCTIONS FOR REAL-WORLD MULTISECTORAL MODELING

Ferran Sancho

Economic Systems Research, 2009, vol. 21, issue 1, 45-58

Abstract: We show how to calibrate CES production and utility functions when indirect taxation affecting inputs and consumption is present. These calibrated functions can then be used in computable general equilibrium models. Taxation modifies the standard calibration procedures since any taxed good has two associated prices and a choice of reference value units has to be made. We also provide an example of computer code to solve the calibration of CES utilities under two alternate normalizations.

Keywords: Calibration; CGE modeling; CES utility and cost functions (search for similar items in EconPapers)
Date: 2009
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Citations: View citations in EconPapers (16)

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Working Paper: Calibration of CES functions for real-world multisectoral modeling (2007)
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DOI: 10.1080/09535310902731270

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