LES5807 - Applied General Equilibrium Models

Credit hours

Instructor
Joaquim Bento de Souza Ferreira Filho

Objective
The objective of this course is to study the construction and implementation of Applied General
Equilibrium (AEG) models in practice. We will be analyze in details the various aspects of construction of
the AEG models: a) definition of the system of equations; b) assembly of the database; c) estimation of
coefficients and parameters; d) solution methods (linear and non-linear); e) calibration; f) closure ; g)
implementation of the model; and h) use of the model. Throughout this process we will work with
models built for the Brazilian economy. The emphasis will be on the practical part of the implementation
of these models, so there will be intense use of computer packages, particularly the GEMPACK program.
At the end of the course students are expected to master the techniques of construction,
implementation, and use of AEG models, as well as the GEMPACK program used in the solution of these
models.

Content
1. Introduction: Course overview and practical examples of application of general equilibrium applied
models.
2. Applied General Equilibrium Models
3.Database preparation.
4. Construction of the equation system: the Minimal BR model;
5. GEMPACK Program;
6. Estimation of coefficients and parameters;
7. Solution Methods;
8. Calibration;
9. Closure;
10. Implementation;
11. Use and simulations;
12. Paper preparation with policy simulation.

Bibliography
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