Multifactor CES General Equilibrium: Models and Applications
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arXiv
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| Format: | Preprint |
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2016
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| _version_ | 1866929548183994368 |
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| author | Kim, Jiyoung Nakano, Satoshi Nishimura, Kazuhiko |
| author_facet | Kim, Jiyoung Nakano, Satoshi Nishimura, Kazuhiko |
| contents | Sector specific multifactor CES elasticity of substitution and the corresponding productivity growths are jointly measured by regressing the growths of factor-wise cost shares against the growths of factor prices. We use linked input-output tables for Japan and the Republic of Korea as the data source for factor price and cost shares in two temporally distant states. We then construct a multi-sectoral general equilibrium model using the system of estimated CES unit cost functions, and evaluate the economy-wide propagation of an exogenous productivity stimuli, in terms of welfare. Further, we examine the differences between models based on a priori elasticity such as Leontief and Cobb-Douglas. |
| format | Preprint |
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arxiv_https___arxiv_org_abs_1608_01365 |
| institution | arXiv |
| publishDate | 2016 |
| record_format | arxiv |
| spellingShingle | Multifactor CES General Equilibrium: Models and Applications Kim, Jiyoung Nakano, Satoshi Nishimura, Kazuhiko Applications General Finance Sector specific multifactor CES elasticity of substitution and the corresponding productivity growths are jointly measured by regressing the growths of factor-wise cost shares against the growths of factor prices. We use linked input-output tables for Japan and the Republic of Korea as the data source for factor price and cost shares in two temporally distant states. We then construct a multi-sectoral general equilibrium model using the system of estimated CES unit cost functions, and evaluate the economy-wide propagation of an exogenous productivity stimuli, in terms of welfare. Further, we examine the differences between models based on a priori elasticity such as Leontief and Cobb-Douglas. |
| title | Multifactor CES General Equilibrium: Models and Applications |
| topic | Applications General Finance |
| url | https://arxiv.org/abs/1608.01365 |