Review on quantitative general equilibrium analysis in international trade and economic geography
《长安大学学报（社科版）》[ISSN:1671-6248/CN:61-1391/C]
- Issue:
- 2018年06期
- Page:
- 1-11
- Research Field:
- 国际经济与贸易
- Publishing date:
Info
- Title:
- Review on quantitative general equilibrium analysis in international trade and economic geography
- Author(s):
- YU Miaojie; ZHANG Rui
- China Center for Economic Research & National School of Development,Peking University, Beijing 100871,China
- Keywords:
- international trade; economic geography; general equilibrium analysis; quantitative approach; global economy
- PACS:
- F740.3
- DOI:
- -
- Abstract:
- In the uptodate research on international trade and economic geography, to evaluate the impacts of macrolevel policy and economic shocks, such as free trade, productivity improvement, and reductions in moving costs, on the global economy and wage distribution for different groups, more and more researchers adopt the approach of quantitative general equilibrium analysis. Such an approach builds on relatively standard model assumptions that integrates all products and other market elements within the economic system into one general equilibrium framework, while at the same time is flexible enough to encompass sophisticated theoretical mechanisms, such as inputoutput linkages, production agglomeration, moving frictions on factor markets, firm’s manufacturing location choice, and capital dynamics. Meanwhile, the calibration, estimation and computation of the models is highly feasible. This paper starts from a simple general equilibrium framework by introducing the key elements and its economic indications, and reviews important extensions of this framework in different dimensions. Relevant researches show that macrolevel policy and economic shocks, such as free trade and productivity improvement, not only directly impact the economic agents being shocked, but also affect other agents in the economy through the general equilibrium channels such as international/intranational trade and factor market linkages. Ignoring these general equilibrium effects would bias the conclusions of relevant researches.
Last Update: 2019-02-25