Estimating General Equilibrium Trade Policy Effects: GE PPML

James Anderson, Mario Larch and Yoto Yotov

No 5592, CESifo Working Paper Series from CESifo

Abstract: We develop a simple estimation procedure for general equilibrium (GE) comparative static analysis of gravity models. Non-linear solvers of estimated models are replaced by (constrained) regressions. Applied economists can more readily generate results, with more intuition about the working of the model. We illustrate with a worldwide border removal application using the Poisson Pseudo-Maximum-Likelihood (PPML) estimator in STATA, iterated to deliver conditional and full general equilibrium responses. The method works by fully exploiting the combined properties of structural gravity and PPML. Our procedures readily extend to a wide class of general equilibrium production models.

Keywords: structural gravity; general equilibrium effects; counterfactuals; estimation (search for similar items in EconPapers)
JEL-codes: F10 F14 F16 (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (61)

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Related works:
Working Paper: Estimating General Equilibrium Trade Policy Effects: GE PPML (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:ces:ceswps:_5592

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