gemInputOutputTable_2_8_4 {GE}R Documentation

A Two-Country General Equilibrium Model with Money

Description

A two-country general equilibrium model with money. This general equilibrium model is based on a two-country (i.e. CHN and ROW) input-output table. Each country contains four sectors and eight commodities (or subjects). The four sectors are production, consumption, investment and foreign trade. The eight commodities (or subjects) are product, labor, capital goods, bond, tax, dividend, imported product and money interest. Hence the input-output table has 16 rows and 8 columns.

Usage

gemInputOutputTable_2_8_4(
  IT,
  product.output.CHN = sum(IT[, "production.CHN"]),
  product.output.ROW = sum(IT[, "production.ROW"]),
  labor.supply.CHN = sum(IT["labor.CHN", ]),
  labor.supply.ROW = sum(IT["labor.ROW", ]),
  capital.supply.CHN = sum(IT["capital.CHN", ]),
  capital.supply.ROW = sum(IT["capital.ROW", ]),
  money.interest.supply.CHN = 5,
  money.interest.supply.ROW = 30,
  es.DIProduct.production.CHN = 0.5,
  es.DIProduct.production.ROW = 0.5,
  es.laborCapital.production.CHN = 0.75,
  es.laborCapital.production.ROW = 0.75,
  es.consumption.CHN = 0.5,
  es.consumption.ROW = 0.5,
  es.investment.CHN = 0.9,
  es.investment.ROW = 0.9,
  interest.rate.CHN = NA,
  interest.rate.ROW = NA,
  return.dstl = FALSE,
  ...
)

Arguments

IT

the input part of the input-output table (unit: trillion yuan).

product.output.CHN

the product output of the production sector of CHN.

product.output.ROW

the product output of the production sector of ROW.

labor.supply.CHN

the labor supply of CHN.

labor.supply.ROW

the labor supply of ROW.

capital.supply.CHN

the capital supply of CHN.

capital.supply.ROW

the capital supply of ROW.

money.interest.supply.CHN

the money interest supply of CHN, that is, the exogenous money supply multiplied by the exogenous interest rate.

money.interest.supply.ROW

the money interest supply of ROW.

es.DIProduct.production.CHN

the elasticity of substitution between domestic product and imported product used by the production sector of CHN.

es.DIProduct.production.ROW

the elasticity of substitution between domestic product and imported product used by the production sector of ROW.

es.laborCapital.production.CHN

the elasticity of substitution between labor and capital goods used by the production sector of CHN.

es.laborCapital.production.ROW

the elasticity of substitution between labor and capital goods used by the production sector of ROW.

es.consumption.CHN

the elasticity of substitution between domestic product and imported product used by the consumption sector of CHN.

es.consumption.ROW

the elasticity of substitution between domestic product and imported product used by the consumption sector of ROW.

es.investment.CHN

the elasticity of substitution between domestic product and imported product used by the investment sector of CHN.

es.investment.ROW

the elasticity of substitution between domestic product and imported product used by the investment sector of ROW.

interest.rate.CHN

the interest rate of CHN.

interest.rate.ROW

the interest rate of ROW.

return.dstl

If TRUE, the demand structure tree will be returned.

...

arguments to be transferred to the function sdm2.

Details

If interest.rate.CHN is NA or interest.rate.CHN is NA, they are assumed to be equal. And in this case, the exchange rate is determined by the ratio of the interest of unit currency of the two countries. In this model, the ratio of a sector's monetary interest expenditure to its transaction value may not be equal to the interest rate because the ratio is not only affected by the interest rate, but also by the sector's currency circulation velocity and other factors.

Value

A general equilibrium, which usually is a list with the following elements:

Examples


ITExample <- matrix(0, 16, 8, dimnames = list(
  c(
    "product.CHN", "labor.CHN", "capital.CHN", "bond.CHN",
    "tax.CHN", "dividend.CHN", "imported.product.CHN", "money.interest.CHN",
    "product.ROW", "labor.ROW", "capital.ROW", "bond.ROW",
    "tax.ROW", "dividend.ROW", "imported.product.ROW", "money.interest.ROW"
  ),
  c(
    "production.CHN", "consumption.CHN", "investment.CHN", "foreign.trade.CHN",
    "production.ROW", "consumption.ROW", "investment.ROW", "foreign.trade.ROW"
  )
))

production.CHN <- c(
  product.CHN = 140, labor.CHN = 40, capital.CHN = 10,
  tax.CHN = 10, dividend.CHN = 20, imported.product.CHN = 5, money.interest.CHN = 5
)
production.ROW <- c(
  product.ROW = 840, labor.ROW = 240, capital.ROW = 60,
  tax.ROW = 60, dividend.ROW = 120, imported.product.ROW = 6, money.interest.ROW = 30
)

consumption.CHN <- c(
  product.CHN = 40, bond.CHN = 30, imported.product.CHN = 5, money.interest.CHN = 2
)

consumption.ROW <- c(
  product.ROW = 240, bond.ROW = 180, imported.product.ROW = 6, money.interest.ROW = 12
)

investment.CHN <- c(
  product.CHN = 30,
  imported.product.CHN = 4, money.interest.CHN = 1,
  bond.ROW = 1,
  money.interest.ROW = 0.02
)

investment.ROW <- c(
  bond.CHN = 1,
  money.interest.CHN = 0.02,
  product.ROW = 180,
  imported.product.ROW = 4, money.interest.ROW = 6
)


foreign.trade.CHN <- c(
  product.ROW = 13,
  tax.CHN = 0.65,
  money.interest.ROW = 0.26
)

foreign.trade.ROW <- c(
  product.CHN = 15,
  tax.ROW = 0.75,
  money.interest.CHN = 0.3
)

ITExample <- matrix_add_by_name(
  ITExample, production.CHN, consumption.CHN, investment.CHN, foreign.trade.CHN,
  production.ROW, consumption.ROW, investment.ROW, foreign.trade.ROW
)

ge <- gemInputOutputTable_2_8_4(
  IT = ITExample,
  return.dstl = TRUE
)
ge$eri.CHN
ge$p
node_plot(ge$dstl[[4]], TRUE)

ge2 <- gemInputOutputTable_2_8_4(
  IT = ge$DV,
  money.interest.supply.CHN = sum(ge$DV["money.interest.CHN", ]),
  money.interest.supply.ROW = sum(ge$DV["money.interest.ROW", ]),
  return.dstl = TRUE
)
ge2$eri.CHN
ge2$p


#### technology progress in CHN
ITTmp <- ITExample
ITTmp["labor.CHN", "production.CHN"] <- ITTmp["labor.CHN", "production.CHN"] * 0.8
geTmp <- gemInputOutputTable_2_8_4(
  IT = ITTmp,
  product.output.CHN = sum(ITExample[, "production.CHN"]),
  return.dstl = TRUE
)
geTmp$eri.CHN


#### increased demand for imported product in CHN
ITTmp <- ITExample
ITTmp["imported.product.CHN", "production.CHN"] <-
  ITTmp["imported.product.CHN", "production.CHN"] * 1.2
geTmp <- gemInputOutputTable_2_8_4(
  IT = ITTmp,
  return.dstl = TRUE
)
geTmp$eri.CHN


#### capital accumulation in CHN
geTmp <- gemInputOutputTable_2_8_4(
  IT = ITExample,
  capital.supply.CHN = sum(ITExample["capital.CHN", ]) * 1.2,
  return.dstl = TRUE
)
geTmp$eri.CHN

##
geTmp <- gemInputOutputTable_2_8_4(
  IT = ITExample,
  capital.supply.CHN = sum(ITExample["capital.CHN", ]) * 1.2,
  es.DIProduct.production.CHN = 0.3,
  return.dstl = TRUE
)
geTmp$eri.CHN



[Package GE version 0.4.5 Index]