Estimating Parameters and Structural Change in CGE Models Using a Bayesian Cross-Entropy Estimation Approach

This paper uses a three-step Bayesian cross-entropy estimation approach in an environment of noisy and scarce data to estimate behavioral parameters for a computable general equilibrium model. The estimation also measures how labor-augmenting produ...

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Main Authors:	Go, Delfin S., Lofgren, Hans, Mendez Ramos, Fabian, Robinson, Sherman
Format:	Publications & Research
Language:	English en_US
Published:	World Bank Group, Washington, DC 2015
Subjects:	ADVANCED COUNTRIES AGRICULTURE ARRANGEMENT BASE YEAR CAPITAL-LABOR RATIO COAUTHORS COMMODITIES COMPETITIVENESS CONSTANT ELASTICITY CONSTANT PRICES CONSTANT RETURNS CONSTANT RETURNS TO SCALE CURRENCY DATA ELEMENTS DATA SET DATA SETS DESCRIPTION DEVELOPED COUNTRIES DEVELOPING COUNTRIES DEVELOPING COUNTRY DEVELOPMENT ECONOMICS DEVELOPMENT POLICY DISTRIBUTION PARAMETER DOMAIN DYNAMIC BEHAVIOR ECONOMETRICS ECONOMIC EFFICIENCY ECONOMIC POLICY ECONOMIC REVIEW ECONOMIC STRUCTURE ECONOMIC STRUCTURES ECONOMIC SYSTEMS ECONOMIC THEORY ECONOMIC TRANSFORMATION ELASTICITY ELASTICITY OF SUBSTITUTION EMPIRICAL ESTIMATION ENDOGENOUS VARIABLES EQUATIONS EQUILIBRIUM EQUILIBRIUM DYNAMICS EQUILIBRIUM THEORY EXOGENOUS VARIABLES EXPECTED VALUE EXPECTED VALUES EXPORTS EXTERNAL SHOCKS FACTOR COMPONENTS FEDERAL RESERVE FEDERAL RESERVE BANK FOREIGN TRADE FUNCTIONAL FORM FUTURE RESEARCH GDP GDP DEFLATOR GENERAL EQUILIBRIUM MODEL GLOBALIZATION GROWTH EPISODES GROWTH RATE GROWTH RATES HISTORICAL DATA INCOMES INDEXES INDICES INDUSTRIALIZATION INEQUALITY INFORMATION PROCESSING INFORMATION TECHNOLOGY INNOVATION MACROECONOMIC ANALYSIS MACROECONOMICS MANUFACTURING MANUSCRIPT MEAN VALUE MEASUREMENT ERROR MODEL ESTIMATION NATIONAL INCOME NATIONAL OUTPUT NORMAL DISTRIBUTION NOTATION NOTATIONS OBSERVED CHANGES OPEN ACCESS OPEN ECONOMY OPTIMIZATION OUTPUTS POLICY DISCUSSIONS POLICY FORMULATION POLICY RESEARCH PRICE CHANGES PRICE SERIES PROBABILITIES PROBABILITY PRODUCT DIFFERENTIATION PRODUCTION FUNCTIONS PRODUCTION STRUCTURE PRODUCTIVITY PRODUCTIVITY GROWTH PROTOTYPE REGIONAL ACCOUNTS REGIONAL LEVEL RELATIVE PRICES RELIABILITY RESULT RESULTS SAVINGS SERIES DATA SMALL ECONOMIES STATISTICAL ANALYSIS STRUCTURAL CHANGE TARGETS TAX TAX RATES TECHNOLOGICAL CHANGE TOTAL FACTOR PRODUCTIVITY TRADE STRUCTURE TRANSACTION USES VALUE ADDED VALUE ADDED SERVICES WEB WORLD DEVELOPMENT INDICATORS
Online Access:	http://documents.worldbank.org/curated/en/2015/01/23855951/estimating-parameters-structural-change-cge-models-using-bayesian-cross-entropy-estimation-approach http://hdl.handle.net/10986/21391

id	okr-10986-21391
recordtype	oai_dc
spelling	okr-10986-213912021-04-23T14:04:02Z Estimating Parameters and Structural Change in CGE Models Using a Bayesian Cross-Entropy Estimation Approach Go, Delfin S. Lofgren, Hans Mendez Ramos, Fabian Robinson, Sherman ADVANCED COUNTRIES AGRICULTURE ARRANGEMENT BASE YEAR CAPITAL-LABOR RATIO COAUTHORS COMMODITIES COMPETITIVENESS CONSTANT ELASTICITY CONSTANT PRICES CONSTANT RETURNS CONSTANT RETURNS TO SCALE CURRENCY DATA ELEMENTS DATA SET DATA SETS DESCRIPTION DEVELOPED COUNTRIES DEVELOPING COUNTRIES DEVELOPING COUNTRY DEVELOPMENT ECONOMICS DEVELOPMENT POLICY DISTRIBUTION PARAMETER DOMAIN DYNAMIC BEHAVIOR ECONOMETRICS ECONOMIC EFFICIENCY ECONOMIC POLICY ECONOMIC REVIEW ECONOMIC STRUCTURE ECONOMIC STRUCTURES ECONOMIC SYSTEMS ECONOMIC THEORY ECONOMIC TRANSFORMATION ELASTICITY ELASTICITY OF SUBSTITUTION EMPIRICAL ESTIMATION ENDOGENOUS VARIABLES EQUATIONS EQUILIBRIUM EQUILIBRIUM DYNAMICS EQUILIBRIUM THEORY EXOGENOUS VARIABLES EXPECTED VALUE EXPECTED VALUES EXPORTS EXTERNAL SHOCKS FACTOR COMPONENTS FEDERAL RESERVE FEDERAL RESERVE BANK FOREIGN TRADE FUNCTIONAL FORM FUTURE RESEARCH GDP GDP DEFLATOR GENERAL EQUILIBRIUM MODEL GLOBALIZATION GROWTH EPISODES GROWTH RATE GROWTH RATES HISTORICAL DATA INCOMES INDEXES INDICES INDUSTRIALIZATION INEQUALITY INFORMATION PROCESSING INFORMATION TECHNOLOGY INNOVATION MACROECONOMIC ANALYSIS MACROECONOMICS MANUFACTURING MANUSCRIPT MEAN VALUE MEASUREMENT ERROR MODEL ESTIMATION NATIONAL INCOME NATIONAL OUTPUT NORMAL DISTRIBUTION NOTATION NOTATIONS OBSERVED CHANGES OPEN ACCESS OPEN ECONOMY OPTIMIZATION OUTPUTS POLICY DISCUSSIONS POLICY FORMULATION POLICY RESEARCH PRICE CHANGES PRICE SERIES PROBABILITIES PROBABILITY PRODUCT DIFFERENTIATION PRODUCTION FUNCTIONS PRODUCTION STRUCTURE PRODUCTIVITY PRODUCTIVITY GROWTH PROTOTYPE REGIONAL ACCOUNTS REGIONAL LEVEL RELATIVE PRICES RELIABILITY RESULT RESULTS SAVINGS SERIES DATA SMALL ECONOMIES STATISTICAL ANALYSIS STRUCTURAL CHANGE TARGETS TAX TAX RATES TECHNOLOGICAL CHANGE TOTAL FACTOR PRODUCTIVITY TRADE STRUCTURE TRANSACTION USES VALUE ADDED VALUE ADDED SERVICES WEB WORLD DEVELOPMENT INDICATORS This paper uses a three-step Bayesian cross-entropy estimation approach in an environment of noisy and scarce data to estimate behavioral parameters for a computable general equilibrium model. The estimation also measures how labor-augmenting productivity and other structural parameters in the model may have shifted over time to contribute to the generation of historically observed changes in the economic arrangement. In this approach, the parameters in a computable general equilibrium model are treated as fixed but unobserved, represented as prior mean values with prior error mass functions. Estimation of the parameters involves using an information-theoretic Bayesian approach to exploit additional information in the form of new data from a series of social accounting matrices, which are assumed were measured with error. The estimation procedure is "efficient" in the sense that it uses all available information and makes no assumptions about unavailable information. As illustration, the methodology is applied to estimate the parameters of a computable general equilibrium model using alternative data sets for the Republic of Korea and Sub-Saharan Africa. 2015-02-03T16:15:27Z 2015-02-03T16:15:27Z 2015-01 http://documents.worldbank.org/curated/en/2015/01/23855951/estimating-parameters-structural-change-cge-models-using-bayesian-cross-entropy-estimation-approach http://hdl.handle.net/10986/21391 English en_US Policy Research Working Paper;No. 7174 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank Group, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper Africa East Asia and Pacific Sub-Saharan Africa Korea, Republic of
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English en_US
topic	ADVANCED COUNTRIES AGRICULTURE ARRANGEMENT BASE YEAR CAPITAL-LABOR RATIO COAUTHORS COMMODITIES COMPETITIVENESS CONSTANT ELASTICITY CONSTANT PRICES CONSTANT RETURNS CONSTANT RETURNS TO SCALE CURRENCY DATA ELEMENTS DATA SET DATA SETS DESCRIPTION DEVELOPED COUNTRIES DEVELOPING COUNTRIES DEVELOPING COUNTRY DEVELOPMENT ECONOMICS DEVELOPMENT POLICY DISTRIBUTION PARAMETER DOMAIN DYNAMIC BEHAVIOR ECONOMETRICS ECONOMIC EFFICIENCY ECONOMIC POLICY ECONOMIC REVIEW ECONOMIC STRUCTURE ECONOMIC STRUCTURES ECONOMIC SYSTEMS ECONOMIC THEORY ECONOMIC TRANSFORMATION ELASTICITY ELASTICITY OF SUBSTITUTION EMPIRICAL ESTIMATION ENDOGENOUS VARIABLES EQUATIONS EQUILIBRIUM EQUILIBRIUM DYNAMICS EQUILIBRIUM THEORY EXOGENOUS VARIABLES EXPECTED VALUE EXPECTED VALUES EXPORTS EXTERNAL SHOCKS FACTOR COMPONENTS FEDERAL RESERVE FEDERAL RESERVE BANK FOREIGN TRADE FUNCTIONAL FORM FUTURE RESEARCH GDP GDP DEFLATOR GENERAL EQUILIBRIUM MODEL GLOBALIZATION GROWTH EPISODES GROWTH RATE GROWTH RATES HISTORICAL DATA INCOMES INDEXES INDICES INDUSTRIALIZATION INEQUALITY INFORMATION PROCESSING INFORMATION TECHNOLOGY INNOVATION MACROECONOMIC ANALYSIS MACROECONOMICS MANUFACTURING MANUSCRIPT MEAN VALUE MEASUREMENT ERROR MODEL ESTIMATION NATIONAL INCOME NATIONAL OUTPUT NORMAL DISTRIBUTION NOTATION NOTATIONS OBSERVED CHANGES OPEN ACCESS OPEN ECONOMY OPTIMIZATION OUTPUTS POLICY DISCUSSIONS POLICY FORMULATION POLICY RESEARCH PRICE CHANGES PRICE SERIES PROBABILITIES PROBABILITY PRODUCT DIFFERENTIATION PRODUCTION FUNCTIONS PRODUCTION STRUCTURE PRODUCTIVITY PRODUCTIVITY GROWTH PROTOTYPE REGIONAL ACCOUNTS REGIONAL LEVEL RELATIVE PRICES RELIABILITY RESULT RESULTS SAVINGS SERIES DATA SMALL ECONOMIES STATISTICAL ANALYSIS STRUCTURAL CHANGE TARGETS TAX TAX RATES TECHNOLOGICAL CHANGE TOTAL FACTOR PRODUCTIVITY TRADE STRUCTURE TRANSACTION USES VALUE ADDED VALUE ADDED SERVICES WEB WORLD DEVELOPMENT INDICATORS
spellingShingle	ADVANCED COUNTRIES AGRICULTURE ARRANGEMENT BASE YEAR CAPITAL-LABOR RATIO COAUTHORS COMMODITIES COMPETITIVENESS CONSTANT ELASTICITY CONSTANT PRICES CONSTANT RETURNS CONSTANT RETURNS TO SCALE CURRENCY DATA ELEMENTS DATA SET DATA SETS DESCRIPTION DEVELOPED COUNTRIES DEVELOPING COUNTRIES DEVELOPING COUNTRY DEVELOPMENT ECONOMICS DEVELOPMENT POLICY DISTRIBUTION PARAMETER DOMAIN DYNAMIC BEHAVIOR ECONOMETRICS ECONOMIC EFFICIENCY ECONOMIC POLICY ECONOMIC REVIEW ECONOMIC STRUCTURE ECONOMIC STRUCTURES ECONOMIC SYSTEMS ECONOMIC THEORY ECONOMIC TRANSFORMATION ELASTICITY ELASTICITY OF SUBSTITUTION EMPIRICAL ESTIMATION ENDOGENOUS VARIABLES EQUATIONS EQUILIBRIUM EQUILIBRIUM DYNAMICS EQUILIBRIUM THEORY EXOGENOUS VARIABLES EXPECTED VALUE EXPECTED VALUES EXPORTS EXTERNAL SHOCKS FACTOR COMPONENTS FEDERAL RESERVE FEDERAL RESERVE BANK FOREIGN TRADE FUNCTIONAL FORM FUTURE RESEARCH GDP GDP DEFLATOR GENERAL EQUILIBRIUM MODEL GLOBALIZATION GROWTH EPISODES GROWTH RATE GROWTH RATES HISTORICAL DATA INCOMES INDEXES INDICES INDUSTRIALIZATION INEQUALITY INFORMATION PROCESSING INFORMATION TECHNOLOGY INNOVATION MACROECONOMIC ANALYSIS MACROECONOMICS MANUFACTURING MANUSCRIPT MEAN VALUE MEASUREMENT ERROR MODEL ESTIMATION NATIONAL INCOME NATIONAL OUTPUT NORMAL DISTRIBUTION NOTATION NOTATIONS OBSERVED CHANGES OPEN ACCESS OPEN ECONOMY OPTIMIZATION OUTPUTS POLICY DISCUSSIONS POLICY FORMULATION POLICY RESEARCH PRICE CHANGES PRICE SERIES PROBABILITIES PROBABILITY PRODUCT DIFFERENTIATION PRODUCTION FUNCTIONS PRODUCTION STRUCTURE PRODUCTIVITY PRODUCTIVITY GROWTH PROTOTYPE REGIONAL ACCOUNTS REGIONAL LEVEL RELATIVE PRICES RELIABILITY RESULT RESULTS SAVINGS SERIES DATA SMALL ECONOMIES STATISTICAL ANALYSIS STRUCTURAL CHANGE TARGETS TAX TAX RATES TECHNOLOGICAL CHANGE TOTAL FACTOR PRODUCTIVITY TRADE STRUCTURE TRANSACTION USES VALUE ADDED VALUE ADDED SERVICES WEB WORLD DEVELOPMENT INDICATORS Go, Delfin S. Lofgren, Hans Mendez Ramos, Fabian Robinson, Sherman Estimating Parameters and Structural Change in CGE Models Using a Bayesian Cross-Entropy Estimation Approach
geographic_facet	Africa East Asia and Pacific Sub-Saharan Africa Korea, Republic of
relation	Policy Research Working Paper;No. 7174
description	This paper uses a three-step Bayesian cross-entropy estimation approach in an environment of noisy and scarce data to estimate behavioral parameters for a computable general equilibrium model. The estimation also measures how labor-augmenting productivity and other structural parameters in the model may have shifted over time to contribute to the generation of historically observed changes in the economic arrangement. In this approach, the parameters in a computable general equilibrium model are treated as fixed but unobserved, represented as prior mean values with prior error mass functions. Estimation of the parameters involves using an information-theoretic Bayesian approach to exploit additional information in the form of new data from a series of social accounting matrices, which are assumed were measured with error. The estimation procedure is "efficient" in the sense that it uses all available information and makes no assumptions about unavailable information. As illustration, the methodology is applied to estimate the parameters of a computable general equilibrium model using alternative data sets for the Republic of Korea and Sub-Saharan Africa.
format	Publications & Research
author	Go, Delfin S. Lofgren, Hans Mendez Ramos, Fabian Robinson, Sherman
author_facet	Go, Delfin S. Lofgren, Hans Mendez Ramos, Fabian Robinson, Sherman
author_sort	Go, Delfin S.
title	Estimating Parameters and Structural Change in CGE Models Using a Bayesian Cross-Entropy Estimation Approach
title_short	Estimating Parameters and Structural Change in CGE Models Using a Bayesian Cross-Entropy Estimation Approach
title_full	Estimating Parameters and Structural Change in CGE Models Using a Bayesian Cross-Entropy Estimation Approach
title_fullStr	Estimating Parameters and Structural Change in CGE Models Using a Bayesian Cross-Entropy Estimation Approach
title_full_unstemmed	Estimating Parameters and Structural Change in CGE Models Using a Bayesian Cross-Entropy Estimation Approach
title_sort	estimating parameters and structural change in cge models using a bayesian cross-entropy estimation approach
publisher	World Bank Group, Washington, DC
publishDate	2015
url	http://documents.worldbank.org/curated/en/2015/01/23855951/estimating-parameters-structural-change-cge-models-using-bayesian-cross-entropy-estimation-approach http://hdl.handle.net/10986/21391
_version_	1764448126786076672

Estimating Parameters and Structural Change in CGE Models Using a Bayesian Cross-Entropy Estimation Approach

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