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Computable General Equilibrium (CGE) Modelling for Regional Economic Development Analysis

  • Year: 2010
  • Author: Partridge, Mark; Rickman, Dan
  • Journal Name: Regional Studies
  • Journal Number: Vol.44, No.10

Despite their long-standing use in economic policy analysis generally, and increasing popularity in regional policy analysis, computable general equilibrium (CGE) models have yet to become the dominant approach for analysis of regional economic development policies. This review discusses the likely reasons for the limited use of CGE models for regional economic development analysis, particularly for small regions. It also proposes methodological improvements that would likely lead to the wider use of CGE models in economic development practice. A central theme is the need for a model that can be empirically demonstrated to capture the relevant policy components and the structure of the region of study.

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