Macro-economy - POLES

From IAMC-Documentation
Revision as of 14:16, 16 August 2016 by Rineke Oostenrijk (talk | contribs)
(diff) ← Older revision | Latest revision (diff) | Newer revision → (diff)
Jump to: navigation, search

Model Documentation - POLES

Corresponding documentation
Previous versions
Model information
Model link
Institution JRC - Joint Research Centre - European Commission (EC-JRC), Belgium, http://ec.europa.eu/jrc/en/.
Solution concept Partial equilibrium (price elastic demand)
Solution method SimulationRecursive simulation
Anticipation Myopic

In POLES key macro-economic assumptions are exogenous: population and growth if GDP per capita. Information comes from external sources: population usually from the UN Population Prospects (latest: the 2012 revision), GDP information from international sources (IMF, MIT, CEPII, national and regional estimates, ..). The consistency between population and income assumptions is checked.

An on-going work will allow connecting POLES to the macro-econometric model MAGE (CEPII) through the use of an "energy factor" in the MAGE production function, allowing to use a more dynamic relation between GDP and energy.

The key marco-economic assumptions are then derived into sectoral economic activity variables:

  • sectoral value added depend on the level of development of the country / region, given by the GDP per capita;

36405548.png Figure 1. Share of value-added as a function of GDP per capita

  • industrial physical production depends on demand, which is itself depending on the level of development;
  • mobility (for passengers and for goods) depends on the cost of transport compared to income, and is declined in equipment rates, degree of utilisation of this equipment, etc.. ;
  • building surfaces depend on households size (cohabitation) and surface per dwelling, both depending on personal income.

All variables also depend on historical data, that capture local specificities.