Macroeconomic Drivers of Baseline Scenarios in Dynamic CGE models: Review and Guidelines Proposal

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Jean Foure
Angel Aguiar
Ruben Bibas
Jean Chateau
Shinichiro Fujimori
Julien Lefevre
Marian Leimbach
Luis Rey-Los-Santos
Hugo Valin

Abstract

For dynamic computable general equilibrium (CGE) modeling, long-term baseline construction is key and depends on the applied methods and the sources of projections considered. For dynamic CGE models, baseline assumptions and base data are both important determinants of results. This paper reviews the assumptions made by 24 modeling teams on baseline macroeconomic drivers, understood as factor accumulation and gross domestic product (GDP) growth. We critically review the various methods, identifying state-of-the-art practices and propose simple guidelines, particularly focusing on consistency between data sources and models, which is intended to help dynamic CGE modelers build their own baselines.

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How to Cite
Foure, J., Aguiar, A., Bibas, R., Chateau, J., Fujimori, S., Lefevre, J., … Valin, H. (2020). Macroeconomic Drivers of Baseline Scenarios in Dynamic CGE models: Review and Guidelines Proposal. Journal of Global Economic Analysis, 5(1), 28–62. https://doi.org/10.21642/JGEA.050102AF
Section
Advances in Methods and Theory