Abstract
This chapter discusses basic issues in project analysis and shows how these issues can be resolved in a computable general equilibrium (CGE) framework. The role of border prices and intersectoral linkages is explored. The CGE framework is compared to less comprehensive frameworks, including benefit-cost analysis, input-output models, multimarket models, and models based on social accounting matrices (SAM’s). An illustrative CGE model of the southern portion of the San Joaquin Valley (Valley) is constructed and is used to find the effects of reducing water inputs to agriculture on aggregate Valley gross domestic product (GDP) and on sectoral output, employment, and land use. The model is also used to determine demand curves for water by the southern portion of the Valley, given alternative specifications of production technology.
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© 1991 Springer Science+Business Media New York
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Berck, P., Robinson, S., Goldman, G. (1991). The Use of Computable General Equilibrium Models to Assess Water Policies. In: Dinar, A., Zilberman, D. (eds) The Economics and Management of Water and Drainage in Agriculture. Springer, Boston, MA. https://doi.org/10.1007/978-1-4615-4028-1_25
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DOI: https://doi.org/10.1007/978-1-4615-4028-1_25
Publisher Name: Springer, Boston, MA
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