In this paper an applied general equilibrium model for the Extremadura region is presented. Our aim is to show the importance of agricultural subsidies in this economy, that it is a distinctive characteristic of this region. To achieve this purpose, we analyse the effects of a supression of these subsidies, using different scenaries related to the labour market and tax compensation. Model param...

Without policy reforms, the aging of the U.S. population is likely to increase the burden of the currently unfunded Social Security and Medicare systems. In this paper we build an applied general equilibrium model and incorporate the population projections made by the Social Security Administration (SSA) to evaluate the macroeconomic and welfare implications of alternative fiscal responses to t...

This paper analyzes the impact of carbon taxes on the Japanese economy using an applied/computable general equilibrium model. This analysis sheds light on both the efficiency and the equity issues of these policies. The study shows that some alleviation measures, e.g. tax differentiation, might be required to ease the damages caused to energy intensive industries. Moreover, considering the regr...

This paper derives the price system in a model of decentralized bilateral exchange. Out of equilibrium, prices are individual subjective estimates of payoff-maximizing exchange ratios, and hence are the private information of individual agents. We show that a system of public prices emerges in the long run, and these public prices are equilibria of the underlying general equilibrium model. We t...

The size distributions of many economic variables seem to obey the double power law, that is, the power law holds in both the upper and the lower tails. I explain this emergence of the double power law—which has important economic, econometric, and social implications—using a tractable dynamic stochastic general equilibrium model with heterogeneous agents subject to aggregate and idiosyncratic ...

Although ecosystems provide myriad services to economies, only one service is considered in most renewable-resource models. The general equilibrium bioeconomic model introduced here admits a second service, and more importantly it accounts for how the two services are impacted by interactions within an eight-species ecosystem and interactions within a regional economy. Endangered Steller sea li...

We investigate the importance of “what”-flexibility on top of “where”and “when”-flexibility for alternative emission control schemes that prescribe long-term temperature targets and eventually impose additional constraints on the rate of temperature change. We find that “what”-flexibility substantially reduces the compliance costs under alternative emission control schemes. When comparing polic...

Documentation IZAΨMOD: The IZA Policy SImulation MODel This paper describes IZAΨMOD, the policy microsimulation model of the Institute for the Study of Labor (IZA). The model uses household microdata from the German SocioEconomic Panel Study and firm data from the German linked employer-employee dataset LIAB. IZAΨMOD consists of three components: First, a static module simulates the effects of ...