Modelling the regional economic impacts of road pricing in an interregional general equilibrium framework

In Denmark in recent years there has been a substantial debate both popular and academic concerning the consequences of introducing road pricing - both the regional consequences and whether road pricing gives a double dividend by reducing environmental externalities and by financing a tax reform where the incentive to work is increased through reduction in income tax rates. In this paper, the discussion on road pricing in Denmark is summarised: In the last 10 years, tax reforms have moved the tax burden to environmental taxation and away from income taxation. The argument has been the "double dividend", where environmental tax reforms both induce environmental improvements and provide welfare gains from a reduction in income tax rates increasing labour supply and production. Lately, the existence of a double dividend has been questioned and it has been argued that only environmental reforms reducing the relative welfare from leisure time activities and increasing the benefits from working will give a double dividend. Next the distributional problems from road pricing are discussed. The point of departure is different road pricing schemes, which have been proposed in Denmark and the discussion of double dividend, where road pricing can be used to change the relative prices between working and leisure time activities. Finally, an applied interregional general equilibrium model for Danish municipalities, LINE is presented. The first results from the calculation with the model are presented and methods to model the double dividend are presented.

The General Interregional Price Model

In the input-output tradition regional and interregional spill-over and feedback effects are related to changes in the real economic activities. However, the effects of changes in costs and prices on real economic activity have usually been neglected, despite the fact that the redistributive effects from this dual element in the intra- and interregional economy might be considerable and have effects on economic activity, which are comparable with the quantity effects. CGE-models on the other hand have explicitly addressed this issue using non-linear functions to overcome theoretical problems related to the use of fixed coeffients, permitting for example a more satisfactory treatment of substitution between factors of production or commodities as well as the effects of changing costs on patterns of trade and other forms of interaction. Following the input-output tradition, a structural model for the formation of prices in a local economy involving the price determination through local economic interaction such as commuting and shopping an interregional interaction, such as trade the general interregional price model is derived. The equations of the general interregional price model are presented together with the solution of the model. The theoretical changes examined include a set of new geographical concepts and in the context of an interregional SAM the development of the two-by-two-by-two approach, involving two sets of actors (production units and institutional units), two types of markets (commodities and factors) and two locations (origin and destination). Finally, a simultaneous solution to the combined general interregional quantity and price model based upon the most simple link is outlined.

Ultrasound-enhanced Fibrinolysis Pro-fibrinolytic and Non-beneficial Effects Of Ultrasound Exposure

The aim of this study was to further clarify the pro-fibrinolytic effects, and to explore the possible non-beneficial effects in ischemic organs, during exposure to pulsed ultrasound. This was accomplished by studies of the effects of different intensities of pulsed ultrasound exposure on the fibrinolytic properties of streptokinase and reteplase. Measurements were performed both following pre-exposure of the drugs and clots to pulsed ultrasound, and following concomitant exposure of clots and drugs. In the exploration of pro-fibrinolytic effects during ultrasound exposure it was shown that exposure of the streptokinase molecule to low-intensity, pulsed high frequency ultrasound modulates its fibrinolytic properties. The effects were present following ultrasound exposure of streptokinase solution and during ultrasound exposure of clots and streptokinase solution concomitantly. Depending on its intensity, modulation was observed as both increased and decreased fibrinolytic effects. Pre-exposure of reteplase solution to low-intensity ultrasound induced changes in the function of the reteplase molecule associated with enhanced fibrinolytic effects. Enhancement effects were also seen when the clots were pre-exposed to high intensities of ultrasound before or concomitantly with exposure to reteplase solution, suggesting that two different intensity-dependent mechanisms are involved in ultrasound-enhanced reteplase fibrinolysis. No decreased fibrinolytic effect of reteplase depending on ultrasound exposure could be seen. In an initial study of the fibrinolytic effects induced by a combination of Sonazoid® microbubbles and ultrasound, the effects of various ultrasound parameters on the microbubble destruction-rate was studied. It was shown that, at the same intensity level, the destruction-rate was faster outside the resonance frequency range. Five pulses were needed to achieve a fast destruction-rate. An ultrasound intensity of 0.5 W/cm2 was shown to be the lowest intensity yielding a fast destruction-rate of Sonazoid® microbubbles. The possible non-beneficial effects in ischemic organs of ultrasound with characteristics used to enhance fibrinolysis in vivo were studied in two different models, one using non-perfused myocardia in pigs, and one using non-perfused brain tissue in rats. It was shown that prolonged exposure of low intensity pulsed ultrasound might increase instantaneous myocardial damage. However, the same frequency, intensity and duration of pulsed ultrasound did not seem to enhance ischemic damage in non-perfused rat brain or induce any damage in the perfused rat brain. In conclusion, ultrasound-enhanced fibrinolysis is induced by multiple mechanisms and drug specific reactions, and this study shows the importance of evaluating the effects of exposure on ischemic tissue, aiming at ultrasound-enhanced fibrinolysis

An Approach to Interface Synthesis

This paper present a novel interface synthesis approach based on a one-sided interface description. Whereas most other approaches consider interface synthesis as optimizing a channel to existing client/server modules, we consider the interface synthesis as part of the client/server module synthesis (which may contain the re-use of existing mod-ules). The interface synthesis approach describes the basic transformations needed to transform the server interface description into an interface description on the client side of the communication medium. The synthesis approach is illustrated through a point-to-point communication, but is applicable to synthesis of a multiple client/server environ-ment. The interface description is based on a formalization of communication events.

Modelling Transport in an Interregional General Equilibrium Model with Externalities

In this working paper the regional impacts of road pricing on cars are analysed taking into account externality effects from transportation on wages and productivity. In the paper the direct impacts from changes in transport costs on level of wages and productivity (=direct externality effects) have been estimated. The direct and derived impacts of road pricing have been analysed with AKF’s local economic model LINE and include the impacts on regional production, income and employment. LINE is an interregional general equilibrium model, which uses an interregional social accounting matrix (SAM-K) and a regional transport satellite account as the basis for modelling. Additionally, data from a GIS-system (Technical University of Copenhagen) on transport costs have been included to estimate the demand for transport commodities and increase in transport demand and costs due to road pricing. The direct effects on level of wages and productivity have been included into the model together with all the direct effects on commodity prices from road pricing. In the working paper the total impacts of road pricing have been subdivided into 2 components: 1) The wage effects of reducing income net of commuting of increasing transport cost by introduction of road pricing, 2) the labour contraction effect from increasing wages through increase in commuting cost and 3) the negative productivity effects of introducing road pricing. In total the impacts of road pricing are substantial. Regions with high level of average commuting cost (suburban areas in Greater Copenhagen) suffers most, whereas the centre of Copenhagen suffers least because of short commuting distances. In rural areas impacts are on or just below average because low level of road pricing.

Modelling the regional economic impacts of road pricing in an interregional general equilibrium framework

In Denmark in recent years there has been a substantial debate both popular and academic concerning the consequences of introducing road pricing - both the regional consequences and whether road pricing gives a double dividend by reducing environmental externalities and by financing a tax reform where the incentive to work is increased through reduction in income tax rates. In this paper, the discussion on road pricing in Denmark is summarised: In the last 10 years, tax reforms have moved the tax burden to environmental taxation and away from income taxation. The argument has been the "double dividend", where environmental tax reforms both induce environmental improvements and provide welfare gains from a reduction in income tax rates increasing labour supply and production. Lately, the existence of a double dividend has been questioned and it has been argued that only environmental reforms reducing the relative welfare from leisure time activities and increasing the benefits from working will give a double dividend. Next the distributional problems from road pricing are discussed. The point of departure is different road pricing schemes, which have been proposed in Denmark and the discussion of double dividend, where road pricing can be used to change the relative prices between working and leisure time activities. Finally, an applied interregional general equilibrium model for Danish municipalities, LINE is presented. The first results from the calculation with the model are presented and methods to model the double dividend are presented

The General Interregional Quantity Model

The paper gives a mathematical presentation of the interregional general equilibrium model LINE, which is a sub-regional economic model for Danish municipalities. LINE is an extended version of a simple national general equilibrium model, where space and SAM-actors have been included. The basic structure of the model includes a real circle, showing the conventional Keynesian demand chain, where production is determined by demand, income by production, and private consumption by income. In this circle regional and interregional spillover and feed-back effects and interaction between SAM-actors are included. Further, the basic structure includes a cost-price circle, showing the determination of prices of production by the costs of production, including costs of intermediate consumption, wages and salaries and profits. Sector prices are then transformed to commodity prices by place of production, to commodity prices at place of commodity market place and to private consumption at place of residence. Finally, LINE is closed through a number of links between the real circle and cost-price circle, including equations for the behaviour of the consumers and producers. Given the analytical solution to LINE, it is possible to evaluate the regional impacts of changes in exogenous variables, such as the transport system or policy instruments. Using model multipliers obtained from the analytical solution the impacts of changes in regional demand and its structure, changes in regional productivity, changes in regional labour market and other regional economic changes are examined. Of special interest are the impacts of changes in regional accessibility, which in the new economic geography literature, is an important factor determining regional development