Papers by Madanmohan Ghosh
Social Science Research Network, 1999
Climate Change Economics
This paper presents the overall and distributional welfare effects of alternative multi-regional ... more This paper presents the overall and distributional welfare effects of alternative multi-regional emissions trading coalitions relative to unilateral action. It focusses on meeting Paris Agreement pledges and more emissions reduction targets consistent with 2∘C and 1.5∘C temperature pathways in 2030. The results from seven computable general equilibrium (CGE) models are compared. Across all models, welfare gains are highest with a global market and increase with the stringency of targets. All regional coalitions also show overall welfare gains, although lower gains than the global market. The models show more variability in the gains by a participant. Depending on the model, participants may benefit more from some regional arrangements than from a global market or face modest losses compared to the domestic reductions alone, due to interactions between carbon targets and fossil fuel markets. The scenario with a joint China–European Union emissions trading system in all sectors is con...
Energy and climate change, Dec 1, 2023
Economic Systems Research
Research Papers in Economics, Mar 1, 1998
Review of Development Economics, 2007
This paper utilizes a general equilibrium R&D model of endogenous growth via increasing capital v... more This paper utilizes a general equilibrium R&D model of endogenous growth via increasing capital variety to examine the impact of alternative policies on productivity and economic growth. The model is calibrated using data from the Canadian economy. Findings reveal that direct incentives such as subsidies to R&D activities would have the highest productivity impact on the Canadian economy, that an increase in subsidies to the users of R&D capital (output) would have a positive but smaller impact, and trade liberalization would have minimal effects on productivity growth via its impact on international R&D spillovers.
Journal of Policy Modeling, 2002
In this paper we analyse the implications of various potential regional trade arrangements on the... more In this paper we analyse the implications of various potential regional trade arrangements on the globe for small, medium, and large countries using a general equilibrium multi-region model of world trade. We show that the effects of regional trade arrangements on member and non-member countries are different for different equilibrium concept and the nature of agreements. In a traditional competitive equilibrium framework the welfare effects are small and non-member nations lose marginally due to a trade diversion. In a non-cooperative Nash equilibrium framework small non-member nations are worse affected. Since the larger regions can bring the terms of trade in their favor by retaliation, and hence could gain from retaliation, the growth of regional trade arrangements is a great cause of concern for the smaller regions. This concern becomes stronger if these trade arrangements are customs unions (CU). This makes small and medium size nations seeking trading arrangement with larger nations as a safe heaven strategy.
Journal of Development Economics, 2004
Economics Letters, 1999
Armington trade models with price taking behaviour and CET and CES functions may have perverse of... more Armington trade models with price taking behaviour and CET and CES functions may have perverse offer curves and Nash equilibria in tariff games may not exist in the two country case.
Economic Modelling, 2008
We explore the implications of trade liberalization in economies with State Owned enterprises (SO... more We explore the implications of trade liberalization in economies with State Owned enterprises (SOEs) both theoretically and through simulation analysis. SOEs are modelled as controlled by the members of the enterprise who determine output and effort levels, while facing output prices and wage rates set by government. Enterprise members must collectively meet a budget constraint that the value of sales equals the enterprise wage bill plus an exogenous enterprise commitment to the state budget. Labour can shirk either through low on the job effort (leisure), or through moonlighting to second jobs in the private sector. Three alternative formulations of equilibria in SOE economies are explored, and in these trade liberalization can produce effects opposite from conventional competitive models. In particular, the output of import competing SOEs increases rather than falls, and negative effects on imports can also occur. We also explore the implications of these models using data on Vietnam. Firm empirical estimates are not available for all model parameters, but when calibrated to 1995 data for Vietnam these models suggest quantitatively much larger impacts from trade liberalization than is the case for comparable conventional competitive models. This is because departures from Pareto optimality in SOE economies can be large and trade liberalization acts to discipline shirking associated with these inefficiencies. The implication we draw from our analyses is that to evaluate policy initiatives, such as trade liberalization, in developing and transition economies without explicitly recognizing the role that SOEs can play may be misleading. This is especially the case where SOEs account for a significant fraction of economic activity and shirking occurs.
Journal of Development Economics, 1999
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Ottawa: Industry Canada, 2004
RESEARCH REPORT-DEPARTMENT OF …, 1999
1. An earlier version of the paper was presented at the Third Annual MIMAP Conference, 2-6 Novemb... more 1. An earlier version of the paper was presented at the Third Annual MIMAP Conference, 2-6 November, 1998, Kathmandu, Nepal. This work has been supported by IDRC "MIMAP (Vietnam) Public Finance", Phase I, from January 1996 to July 1998. We are grateful to ...
This paper analyzes the trends in GHG emissions intensity over the period 1995-2009, in a mix of ... more This paper analyzes the trends in GHG emissions intensity over the period 1995-2009, in a mix of developing and developed economies that account for constitute almost 2/3rd of global emissions. In doing so it distinguishes between the demand-based emissions (DBEs) and production-based emissions (PBEs). Several studies find that while PBEs in the developed economies during the period have been stabilized, the DBEs are on the rise. Understanding the relative influence of various factors that has shaped the differential patterns of emissions growth will provide us with important policy insights for controlling GHG emissions. It undertakes a decomposition exercise to understand the changes in both PBEs and DBEs intensities due to changes in technological change and structural shifts in production and final consumption. Main findings of the paper are that technology change has been the key driver of emissions intensity improvements in production and consumption. Intensity improvements in...
Most economists ’ instinctive reaction to price controls is that they are harmful. If enforced, t... more Most economists ’ instinctive reaction to price controls is that they are harmful. If enforced, they result in shortages and resource misallocation. With weak enforcement they often result in black markets, and high transaction costs. In this paper we assess the pros and cons of rice price controls in Vietnam given these instincts. We argue that these price controls fix producer prices and allow government marketing agencies to sell at higher prices and hence are, in part, a revenue raising device. As such they may be part of an efficient tax mix, particularly so since agricultural incomes and production go untaxed under the formal tax system. We also argue that such controls can act to dampen costly domestic adjustments in the face of volatile world prices. We develop a multi sector multi household general equilibrium model to numerically analyse the consequences of these price controls, and show that this system can be supported as welfare enhancing under conditions which currentl...
Foreign Trade Review
This article analyses the trends in greenhouse gas (GHG) emissions intensity over the period 1995... more This article analyses the trends in greenhouse gas (GHG) emissions intensity over the period 1995–2009 in a mix of developing and developed economies that account for almost two-thirds of global emissions. From the accounting point of view, it distinguishes between the production-based emissions (PBEs) and consumption or demand-based emissions (DBEs). Several studies find that while PBEs in many developed economies during the last decades have stabilised, the DBEs are on the rise. Understanding the relative influence of various factors that have shaped the different patterns of emissions growth can provide us with important policy insights for controlling GHG emissions. The article undertakes a decomposition exercise to understand the variations/fluctuations in both PBEs and DBEs intensities due to changes in technology and changes in economic structure (i.e., composition of aggregate production and final consumption). The main findings of this article are that, over the period 1995...
Journal of Global Economic Analysis
Limiting global warming in line with the goals in the Paris Agreement will require substantial te... more Limiting global warming in line with the goals in the Paris Agreement will require substantial technological and behavioural transformations. This challenge drives many of the current modelling trends. This paper undertakes a review of 17 state-of-the-art recursive-dynamic computable general equilibrium (CGE) models and assesses the key methodologies and applied modules they use for representing sectoral energy and emission characteristics and dynamics. The purpose is to provide technical insight into recent advances in the modelling of current and future energy and abatement technologies and how they can be used to make baseline projections and scenarios 20-80 years ahead. In order to represent likely energy system transitions in the decades to come, modern CGE tools have learned from bottom-up studies. We distinguish between three different approaches to baseline quantification: (a) exploiting bottom-up model characteristics to endogenize responses of technology investment and utilization, (b) relying on external information sources to feed the exogenous parameters and variables of the model, and (c) linking the model with more technology-rich, partial models to obtain bottom-up and pathway-consistent parameters.
Climate Change Economics
Carbon pricing generates revenues which can be recycled back into the economy in different ways t... more Carbon pricing generates revenues which can be recycled back into the economy in different ways to help mitigate the economic cost of abatement. These include, lump-sum transfers to households; reducing existing distortionary taxes, such as income taxes on labor and capital; investment in technology funds leading to energy/emissions efficiency improvements; and/or infrastructure developments that help expedite the adoption of low or lower carbon-intensive technologies. In this paper, we undertake illustrative simulations to explore how different revenue recycling options influence the overall economic outcome in terms of broad macroeconomic indicators, such as Gross Domestic Product (GDP) or household welfare. Environment and Climate Change Canada’s (ECCC) multi-sector, multi-region Computable General Equilibrium (CGE) model (EC-MSMR) is used to simulate various revenue recycling options. These simulations are undertaken for the U.S. economy. The main findings of the paper are: (i) ...
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Papers by Madanmohan Ghosh