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Handling Market Imperfections In A Spatial Economy: Some Experimental Results Ii

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  • Eduardo A. Haddad
  • Geoffrey J.D. Hewings

Abstract

The Brazilian economy, with significant differences in the distribution of economic activity across regions, presents a challenge to models that adopt a perfectly competitive market structure. This paper employs an interregional CGE model of the Brazilian economy to explore the long-run impacts of positing changes in transportation structure and scale economies on regional and national welfare. In particular, the transportation cost structure is modeled explicitly as a margin rather than in an iceberg form; scale economies are addressed as a way to mimic the imperfectly competitive structure of the Brazilian economy and to capture some of the potential impacts of core-periphery relationships in production structure. This paper complements a previous study by Haddad and Hewings (2005) that focused on the short-run implications of similar experiments

Suggested Citation

  • Eduardo A. Haddad & Geoffrey J.D. Hewings, 2009. "Handling Market Imperfections In A Spatial Economy: Some Experimental Results Ii," Revista ESPE - Ensayos sobre Política Económica, Banco de la Republica de Colombia, vol. 27(58), pages 140-193, August.
    • Handle: RePEc:bdr:ensayo:v:27:y:2009:i:58:p:140-193
    DOI: 10.32468/Espe.5804
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    References listed on IDEAS

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    1. Hertel, Thomas, 1997. "Global Trade Analysis: Modeling and applications," GTAP Books, Center for Global Trade Analysis, Department of Agricultural Economics, Purdue University, number 7685, December.
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    Cited by:

    1. Arguello, Ricardo, 2009. "The Regional Impact of Discriminatory Trade Liberalization on Colombian Agriculture," Journal of Regional Analysis and Policy, Mid-Continent Regional Science Association, vol. 39(2), pages 1-19.
    2. Rodrigo Pacheco & Raphael P. Fernandes & Inácio F. Araújo & Eduardo A. Haddad, 2023. "Trade in Value-Added: Does MFN Status Matter for Colombian Regions?," Advances in Spatial Science, in: Eduardo A. Haddad & Jaime Bonet & Geoffrey J. D. Hewings (ed.), The Colombian Economy and Its Regional Structural Challenges, chapter 0, pages 239-271, Springer.
    3. Ingram, Matthew C. & Marchesini da Costa, Marcelo, 2019. "Political geography of violence: Municipal politics and homicide in Brazil," World Development, Elsevier, vol. 124(C), pages 1-1.

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    More about this item

    Keywords

    interregional CGE model; transportation structure; scale economies;
    All these keywords.

    JEL classification:

    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • R13 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General Equilibrium and Welfare Economic Analysis of Regional Economies
    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection

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