Introductory Course on Computable General Equilibrium Modelling

Trade & Industrial Policy Strategies (TIPS), 814 Church Street, Arcadia, Pretoria, South Africa

Course Leaders: Dirk Ernst van Seventer (dirk [at] tips [dot] org [dot] za) | Rob Davies (rdavies [at] hsrc [dot] ac [dot] za)

Course Material:

The course was taught using a mixture of lectures and hands-on computer lab exercises. Because the emphasis was on developing an understanding of CGE modelling as a practical tool, many sessions involved both lectures and exercises. We also tried to pace the course to ensure maximum understanding. The following programme is thus indicative of the sequence of topics rather than the exact times devoted to each area. Lab sessions included discussion and interpretation of results, to which participants were expected to contribute.


Course material is available for download:

IFPRI CGE Course Material Adapted for TIPS CGE Course Mar07.pdf [333 KB]

Day Morning Afternoon
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Day 6  

TIPS hosted a short course on computable general equilibrium (CGE) modelling at its offices in Pretoria from 8-16 March 2007. The course was available to a limited number of 12 participants.

The IT revolution has allowed techniques that were once the preserve of a handful of leading theoreticians to become part of the practical economist's everyday toolkit. CGE modelling is one of a number of approaches to economy-wide analysis that have become accessible and practicable as data- and computer-based techniques have developed. An increasing number of economists use this framework to analyse real-world issues that were previously approached through less appropriate partial equilibrium methods.

As part of our commitment to ensure that Southern Africa benefits from these development, TIPS has (co)presented a series of related short courses over the past five years. The current course is part of this ongoing programme. The course integrates theory, real world data, hands-on computer work and real-world applications, and participants are

  • introduced to the micro, macro and trade theories that underlie typical CGE models;
  • provided with an overview and practical examples of Social Accounting Matrices (SAMs) and of parameter and elasticity estimation methods which typically provide the data on which CGEs are built;
  • taught GAMS, a programming language widely used in economy-wide policy modelling; and
  • exposed to issues involved in using models for specific applications, such as the analysis of trade, public finance, regulation and environmental economics. Some of these topics will be presented by special instructors, who bring a wide range of practical experiences to the learning process.

These components of the modeller's tool-kit are taught in an integrated and cumulative way. The theory is developed alongside the practical applications, which move from introductory exercises through to more advanced applications. The applications use materials developed by the International Food Policy Research Institute (IFPRI) and adapted by the course instructors to suit Southern African economies.

Participants will apply what they learn to a mini-project, which will be presented to the class at the end of the course. By that time, all participants will have sufficient competence to be able to continue developing their skills independently.

The course is targeted at those who wish to develop professional expertise in the area, as well as those who need to understand the potential and limitations of the use of these approaches without themselves becoming modellers. As such it should appeal to policy-makers and analysts in both the public and the private sectors, as well as to students and academics. Many of the special instructors are alumni of past courses. An intended by-product of the course is the development of a community of builders and users of economy-wide models in Southern Africa.

No previous exposure to CGE modelling is required, although it will be an advantage if participants have some familiarity with SAMs Those without SAM experience are invited to attend a brief introduction the day before the start of the programme.