• Title/Summary/Keyword: general equilibrium model

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Dynamic Welfare Effects of Tax Reform: Case of Korea (세제개편이 한국경제에 미치는 효과에 대한 동적분석)

  • Kim, Sunghyun H.
    • KDI Journal of Economic Policy
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    • v.29 no.2
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    • pp.177-196
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    • 2007
  • This paper analyzes welfare effects of revenue neutral tax reform using a small open economy dynamic general equilibrium model. We apply this model to the Korean data and examine welfare effects of various tax reforms; removal of capital income tax and/or labor income tax financed by consumption tax. We investigate both long run equilibrium and transitional dynamics. The results suggest that there are sizable welfare gains (1-3% of lifetime consumption) when factor income taxes are replaced by consumption tax. Overall gains are generated by long run gains despite short run welfare losses. However, there is welfare loss when capital income tax is replaced by labor income tax.

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Vaporization of Hydrocarbon Fuel Droplet in High Pressure Environments (고압 환경하에서 탄화수소 연료 액적의 기화특성 연구)

  • Kim, Sung-Yup;Yoon, Woong-Sup
    • Proceedings of the KSME Conference
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    • 2003.11a
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    • pp.127-132
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    • 2003
  • A study of high-pressure n-heptane droplet vaporization is conducted with emphasis placed on equilibrium at vapor-liquid interface. General frame of previous rigorous model[1] is retained but tailored for flash equilibrium calculation of vapor-liquid interfacial thermodynamics. The model is based on complete time-dependent conservation equations with a full account of variable properties and vapor-liquid interfacial thermodynamics. The influences of high-pressure phenomena, including ambient gas solubility, thermodynamic non-ideality, and property variation on the droplet evaporation are investigated. The governing equations and associated moving interfacial boundary conditions are solved numerically using a implicit scheme with the preconditioning method and the dual time integration technique. And a parametric study of entire droplet vaporization history as a function of ambient pressure, temperature has been conducted. Some computational results are compared with Sato's experimental data for the validation of calculations. For low ambient temperatures, the droplet lifetime first increases with pressures, then decreases for high pressures. For higher ambient temperatures, the droplet lifetime increase with less amplitude than that of low ambient temperatures, which then decreases with more amplitude than that of low temperatures. The solubility of nitrogen can not be neglected in the high pressure and it becomes higher as the pressure goes up.

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Korea's Demographic Transition and Long-Term Growth Projection Based on an Overlapping Generations Model

  • KWON, KYOOHO
    • KDI Journal of Economic Policy
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    • v.39 no.2
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    • pp.25-51
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    • 2017
  • This paper employs an Overlapping Generations Model to quantify the impacts of Korea's demographic transition toward an older population on the total output growth rate. The model incorporates the projected population through 2060 according by Statistics Korea. The effects of the low fertility and increased life expectancy rates are studied. The model is considered suitable for analyzing the effects of demographic changes on the Korean economy. Under the assumption that the TFP growth rate will not slow considerably in the future, remaining at 1.3% per annum, the gross output growth rate of the Korean economy is projected to slow to 1.1% per annum in the 2050s, from 4.0% in the 2000s. The shrinking workforce due to the decline in fertility plays a significant role in the deceleration of the Korean economy. The increased life expectancy rate is expected to mitigate the negative effect, but the magnitude of its effect is found to be limited.

Modal Analysis and Vibration Control of Smart Hull Structure (스마트 Hull 구조물의 모달 해석 및 진동 제어)

  • Sohn, Jung-Woo;Choi, Seung-Bok
    • Proceedings of the Korean Society for Noise and Vibration Engineering Conference
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    • 2008.04a
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    • pp.299-304
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    • 2008
  • Dynamic characteristics of smart hull structure are investigated and active vibration control performance is evaluated. Dynamic model of smart hull structure with surface bonded Macro-fiber Composite (MFC) actuators is established by analytical method. Equations of motion of the host hull structure are derived based on Donnell-Mushtari equilibrium equations for a thin cylindrical shell. A general model for the interaction between hull structure and MFC actuator is included in the dynamic model. Modal analysis is then conducted and mode shapes and corresponding natural frequencies are investigated. After constructing of the optimal control algorithm, active vibration control performance of the proposed system is evaluated. It has been shown that structural vibration can be reduced effectively with proper control input.

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Modal Analysis and Vibration Control of Smart Hull Structure (스마트 Hull 구조물의 모달 해석 및 진동 제어)

  • Sohn, Jung-Woo;Choi, Seung-Bok
    • Transactions of the Korean Society for Noise and Vibration Engineering
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    • v.18 no.8
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    • pp.832-840
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    • 2008
  • Dynamic characteristics of smart hull structure are investigated and active vibration control performance is evaluated. Dynamic model of smart hull structure with surface bonded macro-fiber composite(MFC) actuators is established by analytical method. Equations of motion of the host hull structure are derived based on Donnell-Mushtari equilibrium equations for a thin cylindrical shell. A general model for the interaction between hull structure and MFC actuator is included in the dynamic model. Modal analysis is then conducted and mode shapes and corresponding natural frequencies are investigated. After constructing of the optimal control algorithm, active vibration control performance of the proposed system is evaluated. It has been shown that structural vibration can be reduced effectively with proper control input.

Long-run Effects of the Korea-China Free-Trade Agreement

  • Kim, Sunghyun;Shikher, Serge
    • East Asian Economic Review
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    • v.19 no.2
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    • pp.117-142
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    • 2015
  • This paper uses a 53-country 15-industry computable general equilibrium model of trade to analyze the effects of the Korea-China free trade agreement on the Korean economy, the manufacturing sector in particular. The model is based on Yaylaci and Shikher (2014) which uses the Eaton-Kortum methodology to explain intra-industry trade. The model predicts that the Korea-China FTA will increase Korea-China manufacturing trade by 56%, manufacturing employment in Korea by 5.7% and China by 0.55%. The model also predicts significant reallocation of employment across industries with the Food industry in Korea losing jobs and other industries there gaining jobs, with the Medical equipment industry gaining the most. There will be some trade diversion from the ASEAN countries, as well as Japan and the United States.

The Nexus Between Monetary Policy and Economic Growth: Evidence from Vietnam

  • NGUYEN, Hoang Chung
    • The Journal of Asian Finance, Economics and Business
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    • v.9 no.1
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    • pp.153-166
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    • 2022
  • The study estimates the Structured VAR and the Dynamic Stochastic General Equilibrium Model for the Vietnamese economy based on the new Keynesian model for small and open economies, with the output gap, inflation, policy interest rate, the Vietnamese exchange rate, and the inflation and interest rate in the United States. The paper aims to clarify the impulse response of the macro variables through their shocks. It offers to model the SVAR and DSGE processes, as well as describe why and how interest rate policy is important in the impulse response of macro variables like the output gap and inflation process. The study supports the central role of monetary policy by giving empirical evidence for the new Keynesian theory, according to which an interest rate shock causes the output gap to widen and inflation to decrease. Finally, the application of the DSGE model is becoming more and more popular in the State Bank of Viet Nam to improve its policy planning, analyzing, and forecasting policy towards sustainable and stable growth.

Climate Change, Agricultural Productivity, and their General Equilibrium Impacts: A Recursive Dynamic CGE Analysis (기후변화에 따른 농업생산성 변화의 일반균형효과 분석)

  • Kwon, Oh-Sang;Lee, Hanbin
    • Environmental and Resource Economics Review
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    • v.21 no.4
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    • pp.947-980
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    • 2012
  • This study analyzes the long-run impacts of climate change on Korean agriculture and economy. We estimate the impacts of climate change on the productivities of major agricultural products including rice, dairy and livestock using both a simulation approach and a semiparametric econometric model. The former predicts a decline in productivity while the latter predicts an increase in productivity due to climate change, especially for rice. A recursive dynamic CGE model is used to analyze the general equilibrium impacts of productivity change under the two different scenarios, derived from the two productivity analysis approaches. The loss of GDP in 2050 is 0.2% or 0.02% of total GDP depending on the scenario. It is shown that the losses in dairy and livestock sectors are larger than that in rice sector, although the losses in those two non-rice sectors have been ignored by most existing works.

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An Economic Evaluation on the Direct Payment System for Environment-friendly Agriculture in Korea Using AGE Model (AGE모형을 이용한 친환경농업직불제의 경제적 성과계측)

  • Kim, Myung-Su;Lee, Young-Ho;Kim, Bae-Sung
    • Journal of the Korea Academia-Industrial cooperation Society
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    • v.17 no.10
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    • pp.39-45
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    • 2016
  • This study analyses the macroeconomic effects of the direct payment system (DPS) for environment-friendly agriculture in Korea. We utilized the applied general equilibrium model (AGE model) for the general agricultural sector as well as the environmentally-friendly agricultural sector. We considered several scenarios based on various direct payment amounts to measure and analyze economic impacts. Scenario 1 considers the current direct payment system. Scenario 2 examines an additional 5% increase from the direct payment amount in scenario 1. Scenario 3 reviews an increase of 10% in direct payment amount while Scenario 4 considers an additional increase of 15% compared with Scenario 1. Lastly, scenario 5 examines a 20% increase in direct payment amounts compared with scenario 1. In addition, the baseline considers conditions prior to the introduction of the direct payment system. The simulation analysis results show that capital formation, production volume, and labor productivity increased in the environment-friendly agricultural sector. In contrast, employment in the environment-friendly agricultural sector decreased. The price of environment-friendly agricultural products following the introduction of the DPS remain consistent with the price of environment-friendly agricultural product before introducing the DPS. This results from price elasticity of supply and demand are inelastic, and there is no change in the income of consumers during the analysis period. However, additional research is necessary for improvement of the model using complementary statistical data for the environmental-friendly agriculture sector.

An Economic Impact Analysis of the Post-2012 Policy Portfolio, Utilizing the Global Dynamic CGE Model (동태 글로벌 CGE 모형을 활용한 정책 포트폴리오의 Post-2012 경제적 파급효과 분석)

  • Kim, Suyi;Cho, Gyeong Lyeob;Yoo, Seung Jick
    • Environmental and Resource Economics Review
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    • v.18 no.4
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    • pp.587-635
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    • 2009
  • The purpose of this study is to develop the Global Dynamic Computable General Equilibrium Model (Global CGE Model) in order to produce an economic impact analysis, including prospective obligations for the Post-2012 regime. This model explores the impact of an international emissions trading market and macroeconomic variables such as GNP, consumption, investment, imports and exports, in accordance with potential increased obligations on the Republic of Korea. Distinguishing it from existing studies, this Global CGE Model divides the global community into major economic groups, and in the capacity of the analyzed global model, reflecting the principle nations' macroeconomic indicators through the theoretical approach of endogenous growth theory. Policies such as an emissions trading scheme and carbon tax are reflected in the model. Also, in particular, the model reflects exogenous technological advances. According to this analysis, the stronger the greenhouse gas reductions, the greater the adverse effects on the economy; among macroeconomic indicators that appear, a significant decline is realized in the balance of trade, along with a significant decrease in investment and consumption. Energy dependence, in particular, plays a large role-varying in degree by industry type-, as greenhouse gas reductions would have a greater impact on energy-intensive industries. Furthermore, if Korea, currently recognized as a developing country, is given the obligation to reduce greenhouse gas emissions, competing countries such as China and other developing countries will be given an advantage.

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