Introducing Imperfect Competition in CGE Models: Technical Aspects and Implications

Roberto Roson

No 2006.3, Working Papers from Fondazione Eni Enrico Mattei

Abstract: This paper considers the technical aspects and the consequences, in terms of simulation results and policy assessment, of introducing imperfect competition in a CGE model. The modifications to the standard CGE framework needed to model imperfect competition in some industries are briefly discussed. Next, the paper discusses whether, how much and why, those changes may affect the qualitative output of a typical simulation experiment. It is argued that technical choices made in designing the model structure may have a significant impact on the model behavior. This is especially evident when the output of the model, under an imperfect competition closure, is compared with that obtained under a standard closure, assuming perfect competition. As an illustration, a scenario of agricultural trade liberalization under alternative market structures is analyzed.

Keywords: Computable general equilibrium models; Imperfect competition; Oligopolistic models; Economies of scale; Empirical industrial organization; Agriculture; Trade liberalization; Trade policy (search for similar items in EconPapers)
JEL-codes: D58 F12 L16 (search for similar items in EconPapers)
Date: 2006-01
New Economics Papers: this item is included in nep-cmp, nep-com and nep-int
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (16)

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Related works:
Journal Article: Introducing Imperfect Competition in CGE Models: Technical Aspects and Implications (2006)
Working Paper: Introducing Imperfect Competition in CGE Models: Technical Aspects and Implications (2006)
Working Paper: Introducing Imperfect Competition in CGE Models:Technical Aspects and Implications (2006)
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Persistent link: https://EconPapers.repec.org/RePEc:fem:femwpa:2006.3

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