| In this dissertation, an experimental multisectoral computable general equilibrium (CGE) model is developed for the Chinese economy. CGE models, based on optimizing behaviors of economic agents in a decentralized economy, allow for a systematic investigation of the interdependences within and across sectors of the economy in production, consumption, factor utilization, and foreign trade. CGE models can also capture nonlinear substitution possibilities and input-output structure, and incorporate macro variables and mechanisms for achieving balance among national aggregates. A CGE model could be applied for a post-reform socialist economy where market mechanisms have been incorporated in commodity production and resource allocation decisions. China has undergone economic reform for the past decade, during which there have been many great institutional and distributional changes in its socioeconomic system. Applying a CGE model to the Chinese economy could help in the analysis of the economic reform, and contribute to knowledge of modeling research.; This thesis begins with background on the Chinese economy and the economic reforms of the last decade, followed by a discussion of the applicability of a CGE model to the Chinese economy and a schematic description of the model for the Chinese economy. Then, a full mathematical specification of the model is presented, combining sophisticated CGE modeling techniques and traditional planning methodologies. Many structural features have been incorporated in the model to reflect many rigidities in China's reforming economy. Next, data sources and reconciliation, model estimation, and calibration are described in more detail. Base run results are further analyzed to examine the many structural imbalances and price system distortions that currently exist in the Chinese economy. Finally, the model is used for energy and foreign trade policy simulation and analysis. |
