The ECOGEM-Chile Model: A CGE Model for Environmental and Trade Policy Analysis

Raúl O’Ryan, Carlos de Miguel and Sebastian Miller
Authors registered in the RePEc Author Service: Raul O'Ryan GAllardo ()

Working Papers Central Bank of Chile from Central Bank of Chile

Abstract: Computable General Equilibrium (CGE) models are a powerful economic tool for multidimensional/multisectoral analysis. They improve traditional input-output analysis generating quantities and prices endogenously and reflecting market incentives. They complement partial equilibrium analysis with a broader scope of analysis and the quantification of indirect and often non-intuitive effects. Environmental applications of CGE models include trade and environment, climate change, energy problems, natural resources management and environmental regulation analysis. The ECOGEM-Chile model described in this paper can be used to analyze impacts on macro, sectoral, social and environmental (air, water and land pollutants) variables of different economic, social or/and environmental policies, such as trade policies, environmental taxes, external price shocks, among others. The model incorporates the recently released 1996 input/output matrix as well as the most recent information on wages and income. In the specific application developed here, the model is used to analyze direct and indirect impacts on the Chilean economy of increasing fuel taxes by 100%. Additionally a trade policy of reducing tariffs to compensate the increase in revenues of these taxes is simulated. The tariff reductions are in line with the current Chilean trade policy. Winners and loser from both exercises are identified as well as the main determinants of the results.

Date: 2003-12
New Economics Papers: this item is included in nep-cmp, nep-env, nep-lam and nep-mac
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Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:chb:bcchwp:247

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