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Multi-sectoral value chain in a bilateral general equilibrium

Author

Listed:
  • Nakano, Satoshi
  • Nishimura, Kazuhiko
  • Kim, Jiyoung

Abstract

The information and communication technology (ICT) is a key engine of economic growth. In this paper, we examine the impact of ICT innovation using a multifactor constant elasticity of substitution (CES) general equilibrium model. Innovation not only leads to productivity growth and thus influence prices, it also changes output and trade patterns, and welfare. To examine trade values, we construct a bilateral multifactor CES general equilibrium model between Japan and the Republic of Korea using linked input–output tables. We estimate elasticities of substitution and productivity growths of the ICT sectors, to assess the effects of ICT improvement on the two countries.

Suggested Citation

  • Nakano, Satoshi & Nishimura, Kazuhiko & Kim, Jiyoung, 2018. "Multi-sectoral value chain in a bilateral general equilibrium," IDE Discussion Papers 691, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    • Handle: RePEc:jet:dpaper:dpaper691
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    References listed on IDEAS

    as
    1. Xing, Wan & Ye, Xuan & Kui, Lv, 2011. "Measuring convergence of China's ICT industry: An input-output analysis," Telecommunications Policy, Elsevier, vol. 35(4), pages 301-313, May.
    2. Jiyoung Kim & Satoshi Nakano & Kazuhiko Nishimura, 2017. "Bilateral multifactor CES general equilibrium with state-replicating Armington elasticities," Papers 1706.09365, arXiv.org, revised Jul 2017.
    3. Jorgenson, Dale W. & Motohashi, Kazuyuki, 2005. "Information technology and the Japanese economy," Journal of the Japanese and International Economies, Elsevier, vol. 19(4), pages 460-481, December.
    4. Vu, Khuong M., 2013. "Information and Communication Technology (ICT) and Singapore’s economic growth," Information Economics and Policy, Elsevier, vol. 25(4), pages 284-300.
    5. Maryam Farhadi & Rahmah Ismail & Masood Fooladi, 2012. "Information and Communication Technology Use and Economic Growth," PLOS ONE, Public Library of Science, vol. 7(11), pages 1-7, November.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Linked Input–Output Tables; Information and Communications Technology; Tracing Elasticities; South Korea; Japan; Input-output tables; Information technology; Communication;
    All these keywords.

    JEL classification:

    • C67 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Input-Output Models
    • D57 - Microeconomics - - General Equilibrium and Disequilibrium - - - Input-Output Tables and Analysis
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • F19 - International Economics - - Trade - - - Other

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