Monash University

Leader(s): Professor John Madden

Offered

Clayton Second semester 2009 (Day)

Synopsis

This unit covers the theoretical structure and application of computable general equilibrium (CGE) models. Topics include:

• the derivation of the model's non-linear equation system
• evaluation of coefficients and parameters, model closure, specification of economic shocks, solution techniques and interpretation of results.

During hands-on computing sessions, students will undertake simulations of a series of economic policy questions and analyse results.

Objectives

The learning goals associated with this unit are to:

• acquire an understanding of the main elements of the theoretical structure of a computable general equilibrium (CGE) model
• acquire an understanding of how a CGE model is calibrated and implemented on computer
• develop the ability to conduct basic simulations with a comparative-static CGE model
• acquire skills in the analysis of the more readily interpretable model results in terms of model theory, data base, closure and shocks
• develop an elementary understanding of the key features of dynamic CGE models.

Assessment

Within semester assessment: 40%
Examination (3 hours): 60%

Contact hours

Two 1.5-hour lectures per week

Prerequisites

EC