We explore how and by how much the values of elasticities of substitution affect estimates of the cost of emissions reduction policies in computable general equilibrium (CGE) models. We use G-Cubed, an intertemporal CGE model, to carry out a sensitivity and factor decomposition analysis. Average...

In most policy applications of general equilibrium modeling, cost functions are calibrated to benchmark data. Modelers often choose the functional form for cost functions based on suitability for numerical solution of the model. The data (including elasticities of substitution) determine first...

This paper introduces a new method for stochastic sensitivity analysis for computable general equilibrium (CGE) model based on Gauss Quadrature and applies it to check the robustness of a large-scale climate policy evaluation. The revised version of the Gauss-quadrature approach to sensitivity...

This paper proposes a methodology to integrate econometric models with Johansen-type computable general equilibrium (CGE) models in instances when it is necessary to generate results consistent with a subset of variables that are endogenous to both models. Results for a subset of the CGE...

The combination of experts' probability distributions involved in a due diligence is valuable for encapsulating the accumulated information for decision makers and providing the current state of expert opinion regarding important uncertainties. Therefore, this paper shows how to create and...

The paper shows the ways of disclosing financial risks by IFRS 7 and certain types of sensitivity analysis. The different possibilities of preparing a sensitivity analysis, such as value at risk are illustrated and their suitability for reporting are faced critically. Following, the manner of...

Computable general equilibrium (CGE) models are the premier analytical platform for assessing the economic impacts of climate change mitigation. But these models tend to treat physical capital as “malleable”, capable of reallocation among sectors over the time-period for which equilibrium is...