The "Large" Model

J.F. Francois, Tinbergen Institute and CEPR
email: Francois@few.eur.nl internet: http://www.Dismal-Science.com/francois


Introduction
The model & how to run it
System requirements
Viewing results
Technical notes and documentation
Files in the Large directory

© J.F. Francois, 1998-2002
Related material and updates are available from:
www.Dismal-Science.com/handbook
Dismal-Science.com™


Introduction
:

The examples involving the "large" model are based on the static, constant returns version of a multi-region general equilibrium model developed by Joseph Francois and Bradley McDonald (with critical help from Thomas Rutherford). This model, which is implemented in GAMS/MPSGE, is the "vanilla" version of the model employed for various Francois, McDonald and Nordstrom papers (1993, 1994, 1995, 1996 etc.) on the Uruguay Round. The SAM included with this file was used for the 1995 World Bank conference "The developing countries and the Uruguay Round." (Hence the working MPSGE model name "IBRD...". Model files are found in the subdirectory "large" on the CD-ROM in the "course" directory, and installed under the "course" directory on the c: drive if the course material has been installed from the CD-ROM.

Social accounting data are benchmarked to 1992, and the sources are described in the Francois, McDonald, and Nordstrom contribution to "The Uruguay Round and the Developing Countries," World Bank discussion paper 304, 1995 (edited by Martin and Winters).

Model Regions and Sectors

regions

production

label

region

label

sector

AUSTNZ
JAPAN_
CANADA
U_S_A_
EUNION
EFTA__
AFRICA
CHINA_
EASIA_
SOASIA
LAT_AM
EEUROP,
ROW___

Australia and New Zealand
Japan
Canada
United States
European Union 12
European Free Trade Area 6
Africa
China
East Asia
South Asia
Latin America
Eastern Europe
Rest of World

GRAINS
OCROPS
LVSTCK
FOREST
FISHRY
MINING
PRFOOD
TEXTLS
APPARL
LUMBPP
PETROL
CHEMCL
STEELM
OMETAL
FABMTL
TSPEQP
OMACHN
OTHRMF
SERVCS

grains
other crops
livestock
forestry
fisheries
extraction industries
processed foods
textiles
apparel
lumber, pulp, & paper
petroleum products
chemicals
steel
non-ferrous metals
fabricated metal products
transport equipment
other machinery
other manufatures
services

Viewing social accounting data: The social accounting data are contained in the flat text file SAM.INC.



The Model

This version of the model is the reference model from which alternative extensions related to capital accumulation and imperfect competition were compared. The version presented here illustrates a variety of theoretical and practical issues:

Running the model: The model can be run immediately from the files in the "Large" directory by typing the following command at the DOS prompt or by executing it from the Windows Explorer.

EXP%.BAT

where

EXP1.BAT

is the static Uruguay Roud experiment

EXP2.BAT

is a free trade in textile and clothing experiment

EXP3.BAT

provides a Solow steady-state version of EXP1


You can turn on simple dynamic features, involving Solow type savings behaviour, through the variable "switch," which then needs to be set equal to one. The model then involves comparison of counterfacutal steady-states.

NOTE: The model may terminate with a nonfatal error at the end. This involves division by zero when calculating percentage changes in trade flows. It can be ignored.

 

 

System Requirements

The model requires GAMS, with an installed MCP solver (MILES or PATH). While a student/demonstration version is distributed (with permission) on the course CD, this is not sufficient to run this model. You will need a full GAMS license.

 


 

Viewing Results

Once you have run the model, you can view the resuls of Experiment % by using Excel to import the file EXP%PRN. An example is presented below: Longer output files are contained in the list file EXP%.LST.

Note: The most recent version of GAMS comes with a graphical interface: GAMSIDE. You may want to explore using its utilities instead.

 


 

Some Technical notes and documentation

This model implements explicit quotas in MPSGE. This is a significant departure from the representation of quantitative restraints as tax equivalents:

This model also uses MPSGE side constraints to endogenize the capital stock (involving steady-state closures).

CGE modelling in GAMS/MPSGE is explained in the following:

[1] T. Rutherford (1998). "Economic Equilibirum Modelling with GAMS: An Introduction to GAMS/MCP and GAMS/MPSGE" University of Colorado, June.

 


 

The Large directory contents

  LARGE DIRECTORY FILES

exp#.bat

executable for experiment #

exp#.gms

the experiment # itself

IBRD.gen

A GAMS/MPSGE work file

Miles.*

solver option files

par.inc

the elasticities

Readme.1st

Text file for DOS-based model sessions

Results.xls

the contents of the exp#.prn files in a spreadsheet

sam.inc

the social accounting data

tax.inc

the tax data

TheModel.gms

MPSGE code for the model

Wrtprm.gms

Gams output utility

Wrtprn.gms

Gams ouptut utility

Wrtset.gms

Gams output utility

NOTE: each model produces a tab and space delimited file that can be read by excel, with the name exp#.prn