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A global multi-sectoral model in local currencies

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  • Yano, Takashi

Abstract

Economic agents make their decisions by focusing on the economic performance of their economies in their currencies rather than in a foreign currency. This shows that a multi-country economic model in local currencies is suitable to analyze global economic issues. However, international input-output tables are denominated in a specific currency such as the US dollar. Employing the OECD Intercountry Input-Output Tables, this paper presents a method to convert the international input-output tables in U.S. dollars and current prices to those in local currencies and constant prices. In addition, the structure of a global model with economies of scale and imperfect competition is illustrated. A numerical example is also demonstrated in order to show the applicability of the model.

Suggested Citation

  • Yano, Takashi, 2018. "A global multi-sectoral model in local currencies," IDE Discussion Papers 703, Institute of Developing Economies, Japan External Trade Organization(JETRO).
    • Handle: RePEc:jet:dpaper:dpaper703
    as

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    References listed on IDEAS

    as
    1. Nakamura, Shinichiro, 1990. "A Nonhomothetic Generalized Leontief Cost Function Based on Pooled Data," The Review of Economics and Statistics, MIT Press, vol. 72(4), pages 649-656, November.
    2. Paolo Pesenti, 2008. "The Global Economy Model: Theoretical Framework," IMF Staff Papers, Palgrave Macmillan, vol. 55(2), pages 243-284, June.
    3. 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.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Global multi-country model; Exchange rate; Local currency; Money; Foreign exchange;
    All these keywords.

    JEL classification:

    • C54 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Quantitative Policy Modeling
    • D57 - Microeconomics - - General Equilibrium and Disequilibrium - - - Input-Output Tables and Analysis
    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
    • F47 - International Economics - - Macroeconomic Aspects of International Trade and Finance - - - Forecasting and Simulation: Models and Applications

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