Abstract
This paper describes the principles of applied computable general equilibrium modelling and the application of a two sector model to the Cameroon economy. An overview is given of the economic situation and performance of Cameroon together with a background summary of the application by Maxwell Stamp of computable general equilibrium models (CGEMs) to policy analysis in industrialising countries. A brief description is made, with reference to the Cameroon multisector equilibrium model, of the theoretical basis, typical structure and key assumptions of a CGEM. A critical explanation of the modelling methodology is then given. The structure and rationale for a two sector model is presented with detailed model equations and the associated data requirements. The model is then used, with national accounts data, to conduct comparative static experiments of the impact of different policy interventions on economic activity and the real exchange rate in Cameroon.
This is a preview of subscription content, log in via an institution to check access.
Access this chapter
Tax calculation will be finalised at checkout
Purchases are for personal use only
Preview
Unable to display preview. Download preview PDF.
References
Arrow, K. and Debreu, G. ‘Existence of an Equilibrium for a Competitive Economy’, Econometrica July 1954, 22 (3).
Chenery, H., Robinson S. and Syrquin, M. ‘Industrialization and Growth a Comparative Study’. Chapter 11 Chenery et al. Alternative Routes to Development, Oxford University Press, October 1986.
Condon, T., Dahl, H. and Deverajan, S. ‘Implementing a Computable General Equilibrium Model on GAMS—The Cameroon Model #2’. Draft World Bank Research Paper, April 1986.
Dervis, K., de Melo, J. and Robinson, S. General Equilibrium Models for Development Policy. Cambridge University Press, 1982.
Deverajan, S. and de Melo, J. ‘Adjustment with Fixed Exchange: Came-roon, Cote d’Ivoire, and Senegal’. The World Bank Economic Review, Vol. 1, No. 3, pp. 447–87, 1987.
Drud, A., Grais, W. and Pyatt, G, ‘An Approach to Macroeconomic Model Building Based on Social Accounting Principals’. World Bank Development Research Department Discussion Paper, October 1985.
Drud, A. and Kendrick, D. ‘Hercules: a System for Large Economywide Models’. World Bank Development Research Discussion Paper, October 1986.
Harris, R. ‘Applied General Equilibrium Analysis of Small Open Economies with Scale Economies and Imperfect Competition’. American Economic Review December 1984, Vol. 75 (5).
Johansen, L. A Multi Sectoral Study of Economic Growth. North Holland, 1960.
Johnson, H. ‘Optimum Tariffs and Retaliation’. Review of Economic Studies 1954, Vol. 21 (2).
Kruegar, A. and Turner, B. ‘Estimating Total Factor Productivity Growth in a Developing Country’ World Bank Staff Working Paper No. 422, October 1980.
Michel, G. and Noel, M. ‘Short Term Responses to Trade and Incentives Policies in the Ivory Coast—Comparative Static Simulations in a Computable General Equilibrium Model’. World Bank Staff Working Paper No. 647, 1984.
Salter, W. ‘Internal and External Balance: The Role Price and Expenditure Effects’. Economic Record 35: pp. 226–38, 1959.
Serra-Puche, J. ‘A General Equilibrium Model for the Mexican Economy’ in Applied General Equilibrium Analysis ed. Scarfe and Shoven, Cambridge University Press, 1984.
Shoven, B. and Whalley, J. ‘Applied General Equilibrium Models of Taxation and International Trade: An Introductory Survey’. Journal of Economic Literature, Vol. 22, Sept. 1984.
Swan, T. ‘Economic Control in a Dependant Economy’. Economic Record, 36: 51–76, 1960.
Syrquin, M., Taylor, L. and Westphal, L. (eds) Economic Structure and Performance: Essays in Honour of Hollis B. Chenery. Academic Press Inc., 1984. Particularly Chapter 22 ‘On the Uses and Abuses of Economy-wide Models in Development Policy Analysis’, Bell, C. and Srinivasan, T. and Chapter 21 ‘Equilibrium and Prices in Multisector Models’, Gins-burgh, V. and Robinson, S. with other chapters of interest: Chapter 16 ‘Adjustment policies and Development Strategies in Sub-Saharan Africa 1975–1978’, Balassa, B. and Chapter 7 ‘Comparative Advantage and Development Policy 20 years Later’, Kruegar A.
Varian, H. Microeconomic Analysis. Norton, 1978.
Editor information
Editors and Affiliations
Copyright information
© 1993 V. N. Balasubramanyam and John Maynard Bates
About this chapter
Cite this chapter
Sarley, D. (1993). Principles of Applied Equilibrium Modelling: A Case Study of the Cameroon Economy. In: Balasubramanyam, V.N., Bates, J.M. (eds) Topics in Policy Appraisal. Case-Studies in Economic Development. Palgrave Macmillan, London. https://doi.org/10.1007/978-1-349-11423-8_2
Download citation
DOI: https://doi.org/10.1007/978-1-349-11423-8_2
Publisher Name: Palgrave Macmillan, London
Print ISBN: 978-1-349-11425-2
Online ISBN: 978-1-349-11423-8
eBook Packages: Palgrave Economics & Finance CollectionEconomics and Finance (R0)