Published on Africa Can End Poverty

How CGE models influence policy

This page in:

Sherman Robinson and I are writing a chapter in the forthcoming Handbook of Computable General Equilibrium (CGE) Modeling on the contribution of CGE models to policy formulation in developing countries.  The paper builds on our earlier piece.  As we did with that paper, we are seeking examples where CGE models have been used (or not been used) in policy discussions.  Please send them as comments on this blog.  Feel free also to comment on the proposed abstract for the paper:

“This paper reviews the experience of CGE models from the perspective of how they have—or have not—influenced public policy in developing countries.  The paper describes different classes of models, from stylized (“toy”) models, to large, multisectoral models to dynamic, perfect-foresight models, and shows what roles they played in shaping policy decisions.  The paper notes the evolution of these models, following different traditions in development economics, from central planning to neoclassical economics to structuralism to endogenous growth, and shows how the particular nature of the models affected their relationship to policy.  Finally, the paper looks at the evolution of policy formulation in developing countries, and shows how the need for country-specific information (rather than rules-of-thumb) and increased reliance on evidence-based policymaking affects the use and influence of CGE models in policy.  The paper distills the lessons from these three approaches to derive a set of characteristics that help determine whether, and how, CGE models will have an impact on policy formulation in developing countries.”


Shanta Devarajan

Teaching Professor of the Practice Chair, International Development Concentration, Georgetown University

Join the Conversation

The content of this field is kept private and will not be shown publicly
Remaining characters: 1000