$TITLE SUBSTITUTION AND STRUCTURAL CHANGE (CHENERY,SEQ=33) * THIS MODEL FOLLOWS CONVENTIONAL INPUT-OUTPUT FORMULATIONS FOR PRODUCTION * WITH NONLINEAR DEMAND FUNCTIONS, IMPORT AND EXPORT FUNCTIONS AND PRODUCTION * FUNCTIONS FOR DIRECT FACTOR USE. * * REFERENCE: CHENERY H AND RADUCHEL W J, IN H CHENERY, STRUCTURAL CHANGE AND DEVELOPMENT * POLICY, OXFORD UNIVERSITY PRESS, NEW YORK AND OXFORD, 1979. SETS I SECTORS / LIGHT-IND, FOOD+AGR, HEAVY-IND, SERVICES / T(I) TRADABLES / LIGHT-IND, FOOD+AGR, HEAVY-IND / LMH POSSIBLE ELASTICITIES / LOW, MEDIUM, HIGH / SDE OTHER PARAMETERS / SUBST, DISTR, EFFIC / ALIAS (I,J) TABLE AIO(I,I) INPUT COEFFICIENTS LIGHT-IND FOOD+AGR HEAVY-IND SERVICES FOOD+AGR .1 HEAVY-IND .2 .1 SERVICES .2 .3 .1 *** * IN THE NEXT 3 TABLES DATA IS SPECIFIED FOR MANY DIFFERENT POSSIBLE * HYPOTHESES ABOUT THE ECONOMY. ONE PARTICULAR SUSBSET IS USED FOR ANY * INDIVIDUAL MODEL. SEE ASSIGNMENT STAMENTS BELOW. *** TABLE PDAT(LMH,*,SDE,I) PRODUCTION DATA LIGHT-IND FOOD+AGR HEAVY-IND SERVICES LOW.A.SUBST LOW.A.DISTR .915 .944 2.60 .80 LOW.A.EFFIC 3.83 3.24 4.0 1.8 LOW.B.SUBST LOW.B.DISTR .276 1.034 2.60 .77 LOW.B.EFFIC 2.551 3.39 4.0 1.77 MEDIUM.A.SUBST .11 .29 .2 .05 MEDIUM.A.DISTR .326 .443 .991 .00798 MEDIUM.A.EFFIC 3.97 3.33 1.67 1.84 MEDIUM.B.SUBST .22 .58 .4 .1 MEDIUM.B.DISTR .41 .47 .92 .08 MEDIUM.B.EFFIC 3.99 3.33 1.8 1.89 HIGH.A.SUBST .45 1.15 .4 .2 HIGH.A.DISTR .456 .483 .917 .23 HIGH.A.EFFIC 4.0 3.33 1.8 1.92 HIGH.B.SUBST .93 1.15 .8 .4 HIGH.B.DISTR .484 .483 .769 .344 HIGH.B.EFFIC 4.0 3.33 1.96 1.96 TABLE DDAT(LMH,*,I) DEMAND PARAMETERS LIGHT-IND FOOD+AGR HEAVY-IND SERVICES (LOW,MEDIUM,HIGH).YNOT 100 230 220 450 MEDIUM.P-ELAS -.674 -.246 -.587 -.352 HIGH.P-ELAS -1 -1 -1 -1 TABLE TDAT(LMH,*,T) TRADE PARAMETERS LIGHT-IND FOOD+AGR HEAVY-IND MEDIUM.ALP .005 .001 .01 HIGH.ALP .0025 .0005 .00178 (MEDIUM,HIGH).GAM 1.0 1.1 1.0 (MEDIUM,HIGH).XSI .005 .0157 .00178 PARAMETER MEW(T) INTERCEPT ON IMPORT COST FUNCTION XSI(T) SLOPE OF IMPORT COST FUNCTION GAM(T) INTERCEPT ON EXPORT REVENUE FUNCTION ALP(T) SLOPE OF EXPORT REVENUE FUNCTION YNOT(I) DEMANDS IN BASE YEAR SIG(I) ELASTICITY OF SUBSTITUTION CAPITAL TO LABOR THET(I) PRICE ELASTICITY OF DEMAND RHO(I) SUBSTITUTION PARAMETER IN PRODUCTION FUNCTIONS DEL(I) DISTRIBUTION PARAMETER IN PRODUCTION FUNCTIONS EFY(I) EFFICIENCY PARAMETER IN PRODUCTION FUNCTIONS ; *** * SELECT COEFFICIENT VALUES FOR THIS RUN *** MEW(T) = 1.0 ; XSI(T) = TDAT("MEDIUM","XSI",T) ; GAM(T) = TDAT("MEDIUM","GAM",T) ; ALP(T) = TDAT("MEDIUM","ALP",T) ; YNOT(I)= DDAT("MEDIUM","YNOT",I) ; THET(I)= DDAT("MEDIUM","P-ELAS",I) ; SIG(I) = PDAT("MEDIUM","A","SUBST",I) ; DEL(I) = PDAT("MEDIUM","A","DISTR",I) ; EFY(I) = PDAT("MEDIUM","A","EFFIC",I) ; RHO(I)$(SIG(I) NE 0) = 1./SIG(I) - 1. ; SCALAR LBAR TOTAL SUPPLY OF LABOR / 750. / PLAB PRICE OF LABOR / 1. / KBAR CAPITAL STOCK / 500 / DBAR TRADE DEFICIT / 0 / ; VARIABLES X(I) QUANTITY OF OUTPUT V(I) VALUE ADDED PER UNIT OUTPUT AT CURRENT PRICES Y(I) FINAL CONSUMPTION P(I) PRICES L(I) LABOR USE PER UNIT OF OUTPUT K(I) CAPITAL USE PER UNIT OF OUTPUT E(I) QUANTITY OF EXPORTS M(I) QUANTITY OF IMPORTS G(T) FOREIGN EXCHANGE COST OF IMPORTS H(T) FOREIGN EXCHANGE VALUE OF EXPORTS PK NOMINAL MARKET PRICE OF CAPITAL PI FACTOR PRICE RATIO PD PRICE DEFLATOR TD TOTAL DEMAND VV(I) INTERMEDIATE RESULT ; POSITIVE VARIABLES X,Y,E,M,G,H,P,K,L,V ; EQUATIONS DTY TOTAL DEMAND: DEFINITION MB(I) MATERIAL BALANCE TB TRADE BALANCE DG(T) DEFINITION OF IMPORTS DH(T) DEFINITION OF EXPORTS DEM(I) DEMAND EQUATIONS LC LABOR CONSTRAINT KC CAPITAL CONSTRAINT SUP(I) SUPPLY EQUATIONS FPR FACTOR PRICE RATIO DEFINITION DVV(I) DEFINITION OF VV DL(I) DEFINITION OF LABOR COEFFICIENT DK(I) DEFINITION OF CAPITAL COEFFICIENT DV(I) VALUE ADDED ; *** * THE NAMING CONVENTION FOLLOWED BELOW IS - * ENDOGENOUS VARIABLES HAVE 1 OR 2 CHARACTER NAMES * EXOGENOUS PARAMETERS HAVE 3 OR MORE CHARACTERS *** DTY.. TD =E= SUM(I, Y(I)) ; MB(I).. X(I) =G= Y(I) + SUM(J, AIO(I,J)*X(J)) + ( E(I) - M(I) )$T(I) ; TB.. SUM(T, G(T)*M(T) - H(T)*E(T)) =L= DBAR ; DG(T).. G(T) =E= MEW(T) + XSI(T)*M(T) ; DH(T).. H(T) =E= GAM(T) - ALP(T)*E(T) ; DEM(I).. Y(I) =E= YNOT(I)*(PD*P(I))**THET(I) ; LC.. SUM(I, L(I)*X(I)) =L= LBAR ; KC.. SUM(I, K(I)*X(I)) =E= KBAR ; SUP(I).. P(I) =E= SUM(J, AIO(J,I)*P(J)) + V(I) ; FPR.. PI =E= PK/PLAB ; DVV(I)$(SIG(I) NE 0).. VV(I) =E= (PI*(1-DEL(I))/DEL(I))**(-RHO(I)/(1+RHO(I))) ; DL(I).. L(I)*EFY(I) =E= ((DEL(I)/VV(I) + (1-DEL(I)))**(1/RHO(I)) )$(SIG(I) NE 0) + 1$(SIG(I) EQ 0) ; DK(I).. K(I)*EFY(I) =E= ((DEL(I) + (1-DEL(I))*VV(I))**(1/RHO(I)) )$(SIG(I) NE 0) + DEL(I)$(SIG(I) EQ 0) ; DV(I).. V(I) =E= PK*K(I) + PLAB*L(I) ; * BOUNDS FOR VARIABLES Y.UP(I) = 2000 ; X.UP(I) = 2000 ; E.UP(T) = 400 ; M.UP(T) = 400 ; G.UP(T) = 4 ; H.UP(T) = 4 ; P.UP(I) = 100 ; P.LO(I) = 0.1 ; L.UP(I) = 1 ; K.UP(I) = 1 ; PK.LO = 0.25 ; PK.UP = 4 ; PI.LO = 0.25 ; PI.UP = 4 ; V.UP(I) = 100 ; VV.LO(I) = 0.001 ; * INITIAL VALUES FOR VARIABLES Y.L(I) = 250 ; X.L(I) = 200 ; E.L(T) = 0 ; M.L(T) = 0 ; G.L(T) = MEW(T) + XSI(T)*M.L(T) ; H.L(T) = GAM(T) - ALP(T)*E.L(T) ; PD.L = 0.3 ; P.L(I) = 3 ; PK.L = 3.5 ; PI.L = PK.L/PLAB ; VV.L(I)$SIG(I) = (PI.L*(1-DEL(I))/DEL(I))**(-RHO(I)/(1+RHO(I))) ; L.L(I) = (((DEL(I)/VV.L(I) + (1-DEL(I)))**(1/RHO(I)) )$(SIG(I) NE 0) + 1$(SIG(I) EQ 0))/EFY(I) ; K.L(I) = (((DEL(I) + (1-DEL(I))*VV.L(I))**(1/RHO(I)) )$(SIG(I) NE 0) + DEL(I)$(SIG(I) EQ 0))/EFY(I) ; V.L(I) = PK.L*K.L(I) + PLAB*L.L(I) ; MODEL CHENRAD /ALL/ ; SOLVE CHENRAD USING NLP MAXIMIZING TD ; SCALAR CVA TOTAL VALUE ADDED AT CURRENT PRICES RVA REAL VALUE ADDED FVE FOREIGN EXCHANGE VALUE OF EXPORTS EMP TOTAL EMPLOYMENT CLI COST OF LIVING INDEX ; CVA = SUM(I,V.L(I)*X.L(I)) ; FVE = SUM(T,E.L(T)*H.L(T)) ; EMP = SUM(I, L.L(I)*X.L(I)) ; CLI = SUM(I, P.L(I)*YNOT(I))/SUM(I, YNOT(I)) ; RVA = CVA/CLI ; DISPLAY CLI,CVA,RVA,FVE,EMP ;