Why, how and when did GTAP happen? What has it achieved? Where is it heading? (original) (raw)
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Linking gtap to national models: Some highlights and a practical approach
The GTAP model is designed for analysis related to international trade. As such, the model comprises a detailed specification of trade between countries, as well as a full set of accounts for the domestic economies. For many situations or types of policy analysis, however, more detailed modeling of specific national economies may be required. This is the case, for example, of questions demanding inter-regional analysis inside the national economies.
Building a better trade model to determine local effects: A regional and intertemporal GTAP model
Intertemporal CGE models allow agents to respond fully to current and future policy shocks. This property is particularly important for trade policies, where tariff reductions span over decades. Nevertheless, intertemporal CGE models are dimensionally large and computationally difficult to solve, thus hindering their development, save for those that are scaled-down to only a few regions and commodities. Using a recently developed solution method, we address this problem by building an intertemporal version of a GTAP model that is large in dimension and can be easily scaled to focus to any subset of GTAP countries or regions, without the need for 'second best' recursive approaches. Specifically, we solve using a new parallel-processing technique and matrix reordering procedure, and employ a non-steady state baseline scenario. This provides an effective tool for the dynamic analysis of trade policies. As an application of the model, we simulate a free trade scenario for Vietnam with a focus on the recent Trans-Pacific Partnership (TPP). Our simulation shows that Vietnam gains considerably from the TPP, with 60 of the gains realised within the first 10 years despite our assumption of a gradual and linear removal of trade barriers. We also solve for intertemporal and sector-specific effects on each industry in Vietnam from the trade agreements, showing an added advantage of our approach compared to standard static and recursive GTAP models.
2008
World textiles trade has long been distorted by a series of quota limitations on market access institutionalised in the Multi Fibres Agreement (MFA). One of the key achievements of the Uruguay Round was the liberalisation of the sector through the Agreement on Textiles and Clothing (ATC). This liberalisation process was a key source of the welfare gains which most models forecast to result from the Round. However, it was never evident that the impact of this liberalisation would be positive for all clothing suppliers. The quotas that had existed in the large industrialised country markets had multiple effects. In particular, they both limited the exports of the most competitive suppliers and encouraged importers in restricted markets to source their goods in a wide range of countries which were not subject to extensive quota restraints. In 2005 the sector was finally fully liberalised. This paper will look at the impacts of that liberalisation on the basis of actual trade figures. It will then compare these flows with the changes forecast by various researchers. These forecasts, mostly based on GTAP analysis, generally indicated gains for many developing country suppliers and losses for preferential suppliers and the EU. In reality, gains have been quite heavily concentrated in a few key suppliers, while many have seen limited increases in trade and a few key exporters have experienced significant losses. This effect is particularly striking in Taiwan and Korea, which were not universally forecast by the models to lose out from the liberalisation. This analysis indicates that, although the GTAP-based models forecast several outcomes accurately-in particular the gains experienced by China and India-for other sources they were less accurate. This paper will explore the reasons behind the difficulties in modelling the sector and its trade policy context and draw some conclusions for future GTAP modelling of quantitative limits on trade.
A GTAP Analysis of the Proposed BRICS Free Trade Agreement
GTAP Resource, 2012
The negotiations for the BRICS FTA have made a significant progress with the four summit level meeting among proposed BRICS FTA. This study used the GTAP model on 57 tradable commodities and nine regions of the world to understand the likely impact of possible BRICS FTA. . In this study, 113 regions given in GTAP data base is mapped to nine regions namely Brazil, Russia, India, China, South Africa, ASEAN, USA, EU and Rest of the World by using GTAP database. This study updates the tariff protection for the nine regions and analyses the possible impacts on various indicators. A scenario of a full FTA between BRICS members is simulated using the GTAP model. Under this scenario, import protection within the BRICS member were removed but maintained between the Non-BRICS countries. Overall, the impact of proposed BRICS FTA would be positive for India as macroeconomics indicators (except trade balance) show positive change. However, at the disaggregate level, result vary across 57 sectors.
Future Prospects of the Gravity Model of Trade: A Bibliometric Review (1993–2021)
Foreign Trade Review, 2023
The gravity model of trade (GMoT) has become popular among practitioners and academics lately, essentially because of its power to provide a comprehensive explanation of real-world trade data. Complementing this are Viner’s concepts of trade creation (TC) and trade diversion (TD), which have been crucial in the development of a conceptual framework for evaluating the trade implications of a trade agreement. This article attempts to conduct a bibliometric analysis for estimating TC and TD using the GoMT. It has been observed that the TC and TD estimations following the use of the GoMT are few. Additionally, TC and TD estimations for free trade agreements (FTA) have been conducted, but not so much for regional trade agreements (RTA). As a result, a broad range of research can be conducted, especially given the recent dynamic environment for new RTAs. A bibliometric analysis was undertaken to evaluate the current level of research on GMoT. The search was conducted through Scopus where ...
Improving the EU Input-Output Database for Global Trade Analysis: the EU-GTAP Project
2015
The European Commission’s DG TRADE and DG Joint Research Centre (DG JRC) are presently working together in the so called EU-GTAP Project. The objective of the EU-GTAP project is to ensure that the Commission bases its trade modelling analysis on the most reliable and recent Supply, Use and Input-Output tables as inputs to its modelling tools, mainly the GTAP database. Bearing this in mind, the main outcome of this project is the submission (to GTAP) of a set of Input-Output Tables for the 28 Member States for the year 2010 under the new European System of Accounts (ESA2010) methodology and in compliance with GTAP submission requirements.
Creating a Disaggregated CGE Model for Trade Policy Analysis: GTAP-MVH
Foreign Trade Review, 2020
Thousands of economists spread across almost every country use the GTAP model to analyse trade policies including trade wars and trade agreements. GTAP has an impressive regional coverage (140 countries), but the standard commodity coverage (57 commodities/industries) can cause frustration when tariffs on narrowly defined products are being negotiated. This article sets out a method for disaggregating commodities/industries in computable general equilibrium models such as GTAP and applies it to GTAP’s motor vehicle sector. The method makes use of readily available highly disaggregated trade data supplemented by detailed input–output data where available and data from a variety of other sources such as commercial market reports. JEL Codes: C68, F13, F14, F17
Assessment of the Usefulness of GTAP for Analysing the EU Enlargement
Assessment of the GTAP …, 2000
2. Model features A summary description of model features is provided in tables 1 to 3. This section highlights the various dimensions along which the models are described. A deeper discussion of the evaluation criteria and an elaborate description of each individual model is provided in Van Tongeren and Van Meijl (1999). 2.1. Conceptual framework: Definition and scope Representation of national economies: partial versus economy-wide models Partial models treat international markets for a selected set of traded goods, e.g. agricultural goods. They consider the agricultural system as a closed system without linkages with the rest of the economy. The main area of application of partial equilibrium models is detailed trade policy analysis to specific products. 14 It is not a straightforward task to develop a sound set of criteria to judge the theoretical consistency of models. This theme is also closely related to the issue of model validation, which we have not taken up in this paper. There exists a sizable, and rather inconclusive, literature on model validation, see e.g. Van Tongeren (1995) for an overview. In addition the evaluation of theoretical and numerical validity would require much more information on the individual models than is available.
Economic impact of freer trade in Latin America and the Caribbean: A GTAP analysis
Latin American Journal of Economics: formerly Cuadernos de Economía, 2012
* This is a revised version of a paper presented at the 3rd Regional Meeting on Computable General Equilibrium (CGE) Modeling organized by The Inter-American Development Bank (IDB) and the Economic Commission for Latin America and the Caribbean (ECLAC), held at the Institute for the Integration of Latin America and the Caribbean (IDB-INTAL) in Buenos Aires, Argentina, in September 2010. The authors are grateful to the meeting participants for their valuable comments and suggestions. The authors would also like to thank the reviewers for their comments on the manuscript.