A Sub-National CGE Model for Italy

32 Pages Posted: 25 Jan 2014 Last revised: 5 Feb 2014

See all articles by Gabriele Standardi

Gabriele Standardi

Fondazione Eni Enrico Mattei

Francesco Bosello

University of Milan - Department of Economics, Business and Statistics; CMCC - Centro Euro-Mediterraneo sui Cambiamenti Climatici

Fabio Eboli

Fondazione Eni Enrico Mattei (FEEM); CMCC - Centro Euro-Mediterraneo sui Cambiamenti Climatici

Date Written: January 24, 2014

Abstract

This paper describes a methodology to develop a Computable General Equilibrium model with a sub-national detail starting from a global database and model presenting the country-level as the highest resolution. This procedure is demonstratively applied to Italy, but can be transferred to any country/macro-region, provided regional data availability. Increasing the spatial resolution of a CGE model can be particularly useful to capture local specificities not only in response to given policy shocks, but also to environmental impacts, as, for instance, those originated by climate change, which are highly differentiated spatially. Conceptual and practical issues are treated: we use an innovative method to estimate bilateral trade flows across sub-national areas and analyse the implications of different assumptions on both factor and good intra-country mobility. We carry out a simple experiment to test the robustness of our regionalized structure.

Keywords: CGE Models, Regional Economics

JEL Classification: C68, D58, R11, R12, R13

Suggested Citation

Standardi, Gabriele and Bosello, Francesco and Eboli, Fabio, A Sub-National CGE Model for Italy (January 24, 2014). FEEM Working Paper No. 4.2014, CMCC Research Paper No. RP0189, Available at SSRN: https://ssrn.com/abstract=2384591 or http://dx.doi.org/10.2139/ssrn.2384591

Gabriele Standardi (Contact Author)

Fondazione Eni Enrico Mattei ( email )

Corso Magenta 63
20123 Milan
Italy

Francesco Bosello

University of Milan - Department of Economics, Business and Statistics

Via Festa del Perdono, 7
Milan, 20122
Italy

CMCC - Centro Euro-Mediterraneo sui Cambiamenti Climatici

via Augusto Imperatore, 16
Lecce, I-73100
Italy

Fabio Eboli

Fondazione Eni Enrico Mattei (FEEM) ( email )

Corso Magenta 63
20123 Milan
Italy

CMCC - Centro Euro-Mediterraneo sui Cambiamenti Climatici ( email )

via Augusto Imperatore, 16
Lecce, I-73100
Italy

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