Estimating a social accounting matrix using entropy difference methods:

There is a continuing need to use recent and consistent multisectoral economic data to support policy analysis and the development of economywide models. Updating and estimating input-output tables and Social Accounting Matrices (SAMs) for a recent year is a difficult and a challenging problem. Typically, input-output data are collected at long intervals (usually five years or more), while national income and product data are available annually, but with a lag. Supporting data also come from a variety of sources; e.g., censuses of manufacturing, labor surveys, agricultural data, government accounts, international trade accounts, and household surveys. The traditional RAS approach requires that we start with a consistent SAM for a particular period and “update” it for a later period given new information on row and column sums. This paper extends the RAS method by proposing a flexible entropy difference approach to estimating a consistent SAM starting from inconsistent data estimated with error, a common experience in many countries. The method is flexible and powerful when dealing with scattered and inconsistent data. It allows incorporating errors in variables, inequality constraints, and prior knowledge about any part of the SAM (not just row and column sums). Since the input-output accounts are contained within the SAM framework, updating an input-output table can be viewed as a special case of the general SAM estimation problem. The paper presents the structure of a SAM and a mathematical description of the estimation problem. It then describes the classical RAS procedure and the entropy difference approach. An example of the entropy difference approach applied to the case of Mozambique is presented. In addition, an appendix includes a listing of the computer code in the GAMS language used in the procedure.Social accounting Mozambique., Estimation theory.,

GAMS code for estimating a social accounting matrix (SAM) using cross entropy methods (CE)

This paper documents the computer code implementing the CE-SAM estimation technique in GAMS (General Algebraic Modeling System). It defines the estimation problem in a deterministic setting; extends the approach to include a stochastic treatment of errors in control totals; summarizes the equations describing CE technique for estimating a consistent SAM starting from an inconsistent data set estimated with error; and provides the GAMS code.Social accounting. ,Stochastic analysis. ,Mathematical models. ,TMD ,

Trade liberalization and complementary domestic policies: a rural-urban general equilibrium analysis of Morocco.

In this study, a dynamically recursive general equilibrium model of Morocco is used to examine alternative trade and domestic policy scenarios involving the implementation of the EU Association Agreement for the period 1998-2012. The model has a detailed treatment of the agricultural and rural economy in Morocco. The results for the trade liberalization scenarios indicate that tariff unification has small aggregate effects whereas the removal of non-tariff barriers has strong positive aggregate effects: factor incomes and household welfare expand considerably more rapidly than for the base. However, trade liberalization disfavors the rural poor, especially in rainfed areas. We simulate the introduction of complementary domestic policies with a non-distorting transfer program that fully compensates the owners of rainfed resources and skill upgrading for the rural labor force. The results indicate that, if combined with at least one of these complementary domestic policies, trade liberalization can lead to a win-win outcome: the welfare of all household groups increases significantly more rapidly than if status-quo policies are followed.Trade liberalization Econometric models., Morocco., Tariff Mathematical models., Agricultural trade.,

Updating and estimating a Social Accounting Matrix using cross entropy methods

The problem in estimating a social accounting matrix (SAM) for a recent year is to find an efficient and cost-effective way to incorporate and reconcile information from a variety of sources, including data from prior years. Based on information theory, the paper presents a flexible “cross entropy” (CE) approach to estimating a consistent SAM starting from inconsistent data estimated with error, a common experience in many countries. The method represents an efficient information processing rule—using only and all information available. It allows incorporating errors in variables, inequality constraints, and prior knowledge about any part of the SAM. An example is presented applying the CE approach to data from Mozambique, using a Monte Carlo approach to compare the CE approach to the standard RAS method and to evaluate the gains in precision from utilizing additional information.Social accounting Mathematical models. ,Mozambique. ,Economics Models. ,Entropy (Information theory) ,

The impact of alternative development strategies on growth and distribution

Addressing longer-term issues of economic development in Egypt, the paper employs a dynamically recursive computable general equilibrium (CGE) model to assess the outcomes associated with two types of development approaches over the period 1998-2012. One is a targeted sector development approach, and the second is a more broad-based development approach. The results indicate that, when agricultural exports remain relatively low, promoting the Egyptian textile sector is a win-win scenario in terms of rapid growth and equity. In addition, adopting policies that maintain agricultural prices leads to rapid growth and a general improvement of the distribution of income among households. A crucial policy objectives for achieving rapid and egalitarian growth for the Egyptian economy is the ability to secure improved access to international textile markets and the successful expansion of agricultural exports.Economic development Egypt. ,Equilibrium (Economics) ,Income distribution Egypt ,

Alternative industrial development paths for Indonesia: SAM and CGE analyses

In this article, we examine the economy-wide effects of three alternative growth paths for Indonesia's industrial sector using SAM (social accounting matrix) multiplier analysis and CGE (computable general equilibrium) modeling. The context of the analysis is the immediate post-crisis period — most likely to be in the next millennium — represented in our study by a modified benchmark data set for 1995. Special attention is given to the overall income and equity effects, considering that egalitarian growth has become a particularly important development objective in Indonesia. The results of SAM multiplier analysis indicate relatively strong macro-linkages from agricultural demand-led (ADL) industrialization, yielding a significantly larger increase in real GDP compared to that arising from industrial development oriented to either food processing or light manufacturing. The simulation results based on CGE modeling, which take account of nonlinearities and supply constraints that are ignored in SAM analysis, bear out the dominant influence of demand linkages in showing that ADL industrialization is associated with a larger GDP increase than the two industrial-led development paths.Social accounting., Indonesia., Industrialization.,

Rice policy, trade, and exchange rate changes in Indonesia: a general equilibrium analysis

This paper presents an agriculture-focused computable general equilibrium model that can be used to analyze the economy-wide impacts of changes in technology, market structure, and the foreign exchange rate on resource allocation, production, and trade in Indonesia. The model includes a specification of the rice market and the government price-support, stocking, and trade policies for rice. Using a mixed complementarity approach, the model incorporates inequalities and changes in policy regime as prices and/or stocks move within specified bands. The model is used to examine the impact on the Indonesian economy of changes in rice yield and exchange rates given different assumptions about the operations of BULOG (National Logistic Agency). An important result is that there is inefficient allocation of resources within agriculture and the rest of the economy if BULOG operates to maintain the rice price when there are significant increases in rice productivity or changes in the exchange rate. With increased productivity in rice, the price support scheme retains resources in rice production that would be better used in other, high value, agriculture. With devaluation, maintaining a low rice price discriminates against rice producers and hence slows the process of structural adjustment. In addition, the price support program is costly and strains the government accounts, even if the administrative costs of operating the program are ignored.Econometric models., Rice Indonesia Marketing., Trade policy Econometric models., Price maintenance Asia., Computable general equilibrium (CGE). ,

Rice price policies in Indonesia: a computable general equilibrium (CGE) analysis

This paper presents an agriculture sector focused Computable General Equilibrium (AG-CGE) model for analyzing the economy-wide impacts of changes in technology, protection, and market structure on resource allocation, production, and trade in Indonesia. The paper incorporates a specification of the rice market and models the government price-support, stocking, and trade policies for rice using a mixed complementarity approach. This approach allows the specification of inequalities and changes in policy regime as prices and/or stocks move within specified bands. The model is used to examine the impact on the Indonesian economy of changes in rice yields given different assumptions about the operations of Bulog (National Logistic Agency). The general equilibrium approach captures and quantifies the effects of the price support policies on resource allocation, trade, relative prices, and the government budget. An important result is that there is inefficient allocation of resources within the agriculture sector and the rest of the economy if Bulog operates to maintain the rice price when there are significant increases in rice productivity. Instead of releasing resources to other high-value agriculture uses and non-agriculture uses, the price support scheme attracts more resources into rice production. In addition, the price support program is costly and strains the government accounts, even if the administrative costs of operating the program are ignored.Rice Yields Indonesia., Price regulation Indonesia., Computable general equilibrium (CGE)., Agricultural resources.,

Smoking Behaviors among Adolescents in Foster Care: A Gender-Based Analysis

Background and objectives: Adolescents in foster care are at high risk for cigarette smoking. However, it is not clear how their smoking behaviors vary by gender. The present study examined lifetime and current smoking among males and females, and explored gender-specific risk factors for engagement in smoking behaviors. Method: Data from the Multi Site Evaluation of Foster Youth Programs was used to evaluate patterns of smoking among adolescents aged 12–18 years (N = 1121; 489 males, 632 females). Results: Males and females did not differ significantly in rates of lifetime and current smoking, or in the age of smoking initiation and number of cigarettes smoked on a typical day. Gender-based analyses revealed that older age and placement in group homes or residential treatment facilities were associated with heightened risk of smoking among males. In contrast, sexual minority status (i.e., nonheterosexual orientation) and increased childhood victimization were associated with heightened risk of smoking among females. A history of running away was linked to smoking in both genders. Conclusion: Gender should be considered when designing intervention programs to address cigarette smoking among foster youth, as the stressors associated with smoking may differ for males and females