IDEAS home Printed from https://ideas.repec.org/p/fer/resrep/171.html
   My bibliography  Save this paper

The VATTAGE Regional Model VERM - A Dynamic, Regional, Applied General Equilibrium Model of the Finn

Author

Listed:
  • Honkatukia, Juha

Abstract

Applied general equilibrium models have become a standard tool for the analysis of structural policies in many countries and international research organisations. Their use has been prompted by both developments in economics, but also on the growing need for quantitative policy analysis. The analysis of actual policy options mandates the use of numerical methods, but there are several other reasons to suggest the use of AGE models in particular. Chief among these is the applicability of models that rely on explicit optimisation on the analysis of welfare impacts of structural policies. It may also be the case that many policy issues are intractable by theoretical models, for example, when the policies concern several sectors or regions of the economy, or involve contradicting effects. This report describes the VERM model used in VATT, the Government Institute for Economic Research. The model has been used to study the effects of various tax policies, regional policies, and environmental policies on the economy. Lately, the model has seen extensive use in the anticipation of regional development, especially in the labour markets. The report contains a full description of the model code and its underlying theory. With the help of examples, it also shows how simulation results can be interpreted.

Suggested Citation

  • Honkatukia, Juha, 2013. "The VATTAGE Regional Model VERM - A Dynamic, Regional, Applied General Equilibrium Model of the Finn," Research Reports 171, VATT Institute for Economic Research.
    • Handle: RePEc:fer:resrep:171
    as

    Download full text from publisher

    File URL: https://www.doria.fi/handle/10024/148709
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Honkatukia, Juha, 2009. "VATTAGE - A dynamic, applied general equilibrium model of the Finnish economy," Research Reports 150, VATT Institute for Economic Research.
    2. Alho, Kari, 2002. "The Equilibrium Rate of Unemployment and Policies to Lower It: The Case of Finland," Discussion Papers 839, The Research Institute of the Finnish Economy.
    3. Shoven, John B. & Whalley, John, 1974. "On the computation of competitive equilibrium on International markets with tariffs," Journal of International Economics, Elsevier, vol. 4(4), pages 341-354, November.
    4. Shoven, John B. & Whalley, John, 1972. "A general equilibrium calculation of the effects of differential taxation of income from capital in the U.S," Journal of Public Economics, Elsevier, vol. 1(3-4), pages 281-321, November.
    5. Jalava Jukka & Pohjola Matti & Ripatti Antti & Vilmunen Jouko, 2006. "Biased Technical Change and Capital-Labour Substitution in Finland, 1902-2003," The B.E. Journal of Macroeconomics, De Gruyter, vol. 6(1), pages 1-20, April.
    6. Shoven,John B. & Whalley,John, 1992. "Applying General Equilibrium," Cambridge Books, Cambridge University Press, number 9780521266550, September.
    7. John B. Shoven & John Whalley, 1973. "General Equilibrium with Taxes: A Computational Procedure and an Existence Proof," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 40(4), pages 475-489.
    8. Shoven, John B & Whalley, John, 1984. "Applied General-Equilibrium Models of Taxation and International Trade: An Introduction and Survey," Journal of Economic Literature, American Economic Association, vol. 22(3), pages 1007-1051, September.
    9. Mark Horridge, 2011. "The TERM model and its data base," Centre of Policy Studies/IMPACT Centre Working Papers g-219, Victoria University, Centre of Policy Studies/IMPACT Centre.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Francois J. Stofberg & Jan H. van Heerden & Heinrich R. Bohlmann, 2020. "A Fiscus for Better Economic and Social Development in South Africa," Working Papers 202072, University of Pretoria, Department of Economics.
    2. Breugel, Gerla van, 2017. "Identification and anticipation of skill requirements: Instruments used by international institutions and developed countries," Documentos de Proyectos 42233, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    3. Honkatukia, Juha, 2019. "Evaluating the welfare effects of public health care provision - an integrated, regional AGE model for Finland," Conference papers 333101, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    4. Frey, Miriam, 2014. "Assessing the Impact of a Carbon Tax in Ukraine," Conference papers 332556, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    5. Roope Husgafvel & Kari Poikela & Juha Honkatukia & Olli Dahl, 2017. "Development and Piloting of Sustainability Assessment Metrics for Arctic Process Industry in Finland—The Biorefinery Investment and Slag Processing Service Cases," Sustainability, MDPI, vol. 9(10), pages 1-16, September.
    6. Stofberg, F.J. & van Heerden, J.H. & Horridge, M. & Roos, L., 2022. "A fiscus for better economic and social development in South Africa," Conference papers 333392, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Zhai, Fan, 2008. "Armington Meets Melitz: Introducing Firm Heterogeneity in a Global CGE Model of Trade," Journal of Economic Integration, Center for Economic Integration, Sejong University, vol. 23, pages 575-604.
    2. Y. Qiang, 1999. "CGE Modelling and Australian Economics," Economics Discussion / Working Papers 99-04, The University of Western Australia, Department of Economics.
    3. Peter B. Dixon, 2006. "Evidence-based Trade Policy Decision Making in Australia and the Development of Computable General Equilibrium Modelling," Centre of Policy Studies/IMPACT Centre Working Papers g-163, Victoria University, Centre of Policy Studies/IMPACT Centre.
    4. Keshab Bhattarai, 2017. "Welfare and Distributional Impacts of Financial Liberalization in an Open Economy: Lessons from a Multi-Sectoral Dynamic CGE Model for Nepal," International Business Research, Canadian Center of Science and Education, vol. 10(1), pages 181-198, January.
    5. Dixon, Peter B. & Rimmer, Maureen T., 2016. "Johansen's legacy to CGE modelling: Originator and guiding light for 50 years," Journal of Policy Modeling, Elsevier, vol. 38(3), pages 421-435.
    6. Tourinho, Octavio Augusto Fontes & Alves, Yann Le Boulluec & Silva, Napoleão Luiz Costa da, 2010. "Implicações Econômicas da Reforma Tributária: Análise com um Modelo CGE," Revista Brasileira de Economia - RBE, EPGE Brazilian School of Economics and Finance - FGV EPGE (Brazil), vol. 64(3), September.
    7. Timothy J. Kehoe, 1996. "Social accounting matrices and applied general equilibrium models," Working Papers 563, Federal Reserve Bank of Minneapolis.
    8. Wang, Zhi & Slagle, James, 1996. "An object-oriented knowledge-based approach for formulating applied general equilibrium models," Journal of Economic Dynamics and Control, Elsevier, vol. 20(1-3), pages 209-236.
    9. Mark D. Partridge & Dan S. Rickman, 1998. "Regional Computable General Equilibrium Modeling: A Survey and Critical Appraisal," International Regional Science Review, , vol. 21(3), pages 205-248, December.
    10. Zafar Iqbal & Rizwana Siddiqui, 2001. "Critical Review of Literature on Computable General Equilibrium Models," MIMAP Technical Paper Series 2001:09, Pakistan Institute of Development Economics.
    11. Guerra, Ana-Isabel & Manresa, Antonio & Sancho, Ferran, 2018. "The true index of cost of living under general equilibrium: The numéraire matters," Economics Letters, Elsevier, vol. 173(C), pages 69-72.
    12. Ngee-Choon Chia & Wahba, Sadek & Whalley, John, 1992. "A general equilibrium based social policy model for Cote d'Ivoire," Policy Research Working Paper Series 925, The World Bank.
    13. Bjarne S. Jensen, 2004. "Pareto Efficiency, Relative Prices, and Solutions to CGE Models," DEGIT Conference Papers c009_006, DEGIT, Dynamics, Economic Growth, and International Trade.
    14. Karim, Mohamed, 2013. "Taxation of agricultural sector in Morocco. An Analysis using a Dynamic Computable General Equilibrium Model," MPRA Paper 45622, University Library of Munich, Germany.
    15. Mark Partridge & Dan Rickman, 2010. "Computable General Equilibrium (CGE) Modelling for Regional Economic Development Analysis," Regional Studies, Taylor & Francis Journals, vol. 44(10), pages 1311-1328.
    16. Fullerton, Don & Ta, Chi L., 2019. "Environmental policy on the back of an envelope: A Cobb-Douglas model is not just a teaching tool," Energy Economics, Elsevier, vol. 84(S1).
    17. Ayoki, Milton, 2017. "Estimating the Revenue Impacts of Tax Harmonisation," MPRA Paper 83548, University Library of Munich, Germany.
    18. Decaluwe, B. & Patry, A. & Savard, L. & Thorbecke, E., 1999. "Poverty Analysis Within a General Equilibrium Framework," Papers 9909, Laval - Recherche en Politique Economique.
    19. Kym Anderson, 2003. "Measuring Effects of Trade Policy Distortions: How Far Have We Come?," The World Economy, Wiley Blackwell, vol. 26(4), pages 413-440, April.
    20. Peichl, Andreas, 2008. "The benefits of linking CGE and Microsimulation Models - Evidence from a Flat Tax analysis," FiFo Discussion Papers - Finanzwissenschaftliche Diskussionsbeiträge 08-6, University of Cologne, FiFo Institute for Public Economics.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:fer:resrep:171. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Anita Niskanen (email available below). General contact details of provider: https://edirc.repec.org/data/vatttfi.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.