Urban CGE Modeling: An Introduction

Abstract

Cities are usually confronted with a large variety of economic development choices. With growing environmental concern as well as rising income and wealth inequalities, assessment of the impacts of such choices is likely to gain in importance. Consequently, the demand for adequate assessment tools will grow. Computable general equilibrium (CGE) models analyze issues of resource allocation and income distribution in market economies. They have become a widely accepted tool for policy assessment over the past two decades but are currently still primarily a field for specialists. This is particularly distinctive in the case of urban CGE models, which are the focus of this paper.