Introduction to Quantitative Policy Analysis with GAMS Technical issues for modelling partial equilibrium models Maria Sassi Introduction The purpose of this paper is to provide an introduction to the use of GAMS for economic partial equilibrium problems. No GAMS experience is requested. The basic syntax of the software is supported by examples in order to better clarify how to construct, calibrate and modify models in order to simulate alternative policy options. Each section starts with a short presentation of the theoretical concepts behind the economic partial equilibrium models which find application in the examples. The organization of the paper is reported in Box 1 Box 1 Organization of the paper – Topics Knowledge Skills 1. Introduction to Quantitative Policy Analysis Basics of - Objective and steps of QPA; quantitative - Component of a model; Understanding of modelling basic concepts policy - Base run; analysis - Types of models. - What is GAMS; - Installation; Introduction - Knowing the interface; Understanding of GAMS basic elements to GAMS - Starting a new project; - Input and output structure; 2. Using GAMS for QPA Short introduction of basic concepts of Modeling with GAMS economic theory for modelling with Developed models with GAMS elements GAMS GAMS introduced by exercises - Single good, single The structure of a model market linear demand In GAMS function - The concept of demand - Single good, two SET command - The objective of demand analysis Demand markets linear demand - Elasticities and functional form of Analysis function demand (pragmatic approach, Engel - Single good, two - Log function, LES, AIDS, GAIDS) markets, Engel function, - DISPLAY command semi-log Engel function - Log endogenous variable (.L=1)
Introduction to Quantitative Policy Analysis with GAMS Technical issues for modelling partial equilibrium models Maria Sassi Introduction The purpose of this paper is to provide an introduction to the use of GAMS for economic partial equilibrium problems. No GAMS experience is requested. The basic syntax of the software is supported by examples in order to better clarify how to construct, calibrate and modify models in order to simulate alternative policy options. Each section starts with a short presentation of the theoretical concepts behind the economic partial equilibrium models which find application in the examples. The organization of the paper is reported in Box 1 Box 1 – Organization of the paper Topics Knowledge Skills 1. Introduction to Quantitative Policy Analysis Basics of quantitative policy analysis - Objective and steps of QPA; - Component of a model; - Base run; - Types of models. Understanding of modelling basic concepts Introduction to GAMS - What is GAMS; - Installation; - Knowing the interface; - Starting a new project; - Input and output structure; Understanding of GAMS basic elements 2. Using GAMS for QPA Short introduction of basic concepts of economic theory for modelling with GAMS Modeling with GAMS Developed models with GAMS GAMS elements introduced by exercises Demand Analysis - The concept of demand - The objective of demand analysis - Elasticities and functional form of demand (pragmatic approach, Engel function, LES, AIDS, GAIDS) - Single good, single market linear demand function The structure of a model In GAMS - Single good, two markets linear demand function SET command - Single good, two markets, Engel function, semi-log Engel function - Log - DISPLAY command - Log endogenous variable (.L=1)
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