Economic activity - IFs
|Institution||Frederick S. Pardee Center for International Futures, University of Denver (Pardee Center), Colorado, USA, https://pardee.du.edu/.|
|Solution method||Dynamic recursive with annual time steps through 2100.|
The economic model (elaborated in the Macro-economy topic) produces GDP at market exchange rates and at purchasing power parity. It also produces value added, consumption, and trade in each of six economic sectors: agriculture, primary energy, raw materials, manufactures, services, and information/communications technology. It further provides a calculation of income distribution in the form of a Gini index.
Two features of the economic model are notable. First, it is embedded in a full social accounting matrix (SAM) structure, thereby assuring consistency of financial flows among firms, households, and government. Second, the production function, fundamentally important to long-term dynamics, includes endogenous representation of multifactor productivity, driving it by changes in human, social, and physical capital from other models, as well as knowledge advance. Both the SAM and the production function are therefore pivot points for the interaction of dynamics across the range of models in the integrated IFs system.
On the forward linkage side, GDP per capita is one of the key distal or deep developmental drivers that affects many other variables across the models of the IFs system. Most often, GDP per capita at purchasing power parity (PPP) is the variable used. See other IFs models for details of its impact.