This paper studies the term structure implications of a simple structural economy in which the representative agent displays ambiguity aversion, modeled by Multiple Priors Recursive Utility. Bond excess returns reflect a premium for ambiguity, which is observationally distinct from the risk...

This paper investigates the robustness of CGE models with respect to the elasticities of substitution in demand between domestically produced goods and foreign goods – the so-called Armington elasticities. The Armington-type modeling of trade is still one of the most extensively used...

In this paper we develop a new methodology for finding optimal government policies in economies with heterogeneous agents. The methodology is solely based on three classes of equilibrium conditions from the government's and individual agent's optimization problems: 1) the first order conditions;...

The paper presents econometric estimates of the capital-labor substitution elasticities in terms of 10 economic activities based on the 2003-2009 data. Elasticities are estimated in the context of computable general equilibrium (CGE) methodology, particularly, based on the constant elasticity of...

We analyse the global economic effects of two influenza pandemics that represent extremes along the virulence-infectiousness continuum of possible pandemics: a high virulence-low infectiousness event and a low virulence-high infectiousness event. We do this by applying results from a...

The Millennium Round of MTNs, which was stillborn in Seattle, was supposed to have initiated wide-sweeping changes to the world's trading system. This paper deals with the impact on the German economy of some changes that might have been forthcoming from proposed liberalization strategies. It...

CGE models are widely used for policy evaluation and impact analysis especially with respect to trade reforms, tax reforms, energy sector reform and development policy analysis. However, the results of such models are often argued to be sensitive to the choice of exogenous parameters such as...

Germany like many other European countries subsidize commuting by granting the right to deduct commuting expenses from the income tax base. This regulation has often been changed and has regularly been under debate during the last decades. The pros (e.g. causing efficiency gains with respect to...

Based on data mainly from the International Comparison Program for 156 countries, we conduct a global cross-sectional estimation of an extended rank-3 MAIDADS demand system for nineteen commodity groups including agri-food detail for integration in a Computable General Equilibrium model. We...

Problems of unemployment and low pay amongst the low-skilled and those with little work experience are severe in many OECD countries. Employment-conditional schemes are policy instruments designed to increase the employment prospects of the low-skilled as well as to support their living...