Chongqing Computable General Equilibrium (cge) Model

Since directly under the Jurisdiction of the central Government, Chongqing'seconomy have obtained relatively fast development, and GDP per capital have rankedfrom19in1997to13at present. All of these are because the government has adoptedeffective polities, while how much the impact of these polities is hard to balance. Weneed to find a measure of policy to balance it. Computable general equilibrium (CGE)model has been proved to be a very effective policy analysis and forecasting tools afternearly30years of development. It has the advantage not only lies in its ability to clearlydescribe the microscopic structure, but also it will be the macro variables and microeconomic variables organically linked. Thus, the debate on the different policy options,we attributed to the behavior assumptions, parameter selection, and consider thedifference between the target policies in the CGE model. In addition, the CGE modeldescribe the interaction between multiple markets and structure, which can estimatedthat a particular policy change in a department, but also to estimate the impact on theeconomy as a whole. For these reasons, we programmed the CGE model in Chongqing.We programmed an open and six parts CGE model of Chongqing, and prepared theSAM of Chongqing according to the actual situation of the Chongqing's statistics data.Model parameters are estimated by the calibration and econometric methods, finally thepolicy to narrow the gap between urban and rural residents' income (mainly financialand taxation) were simulated, and concluded that from two aspects to reduce urbanresidents and rural residents' disposable income disparities and improve the economiclevel, improving urban residents' income tax and increase urban and rural residentstransfer payment rather than simply the effect of income tax of increasing transferpayments.This paper is divided into six parts to introduce Chongqing's CGE model. The firstpart of this article is an introduction, which mainly introduced the research background,research status at home and abroad and research thought and innovation. CGE modelwere summarized in the second part, which mainly introduced the CGE model'sgeneration and development, theoretical basis, characteristics, basic structure andapplication. The third part analyzed the Chongqing's economic development whichshows that building the CGE model of Chongqing is necessity. The fourth part is mainlyintroduced in this paper the six part of the construction of open CGE model variables,parameters and equations. The fifth part of the preparation programmed the SAM ofChongqing and estimated the parameters. The last part is mainly carried out to solve the model and application, evaluation and selecting of different policies.