COWLES FOUNDATION FOR RESEARCH IN
ECONOMICS Box 208281
COWLES FOUNDATION DISCUSSION PAPER NO. 836 "A Modeling System for Applied General Equilibrium Analysis" Thomas F. Rutherford May 1987 Numerical modeling in the Arrow-Debreu framework has emerged as a consistent approach for economic analysis. A major disadvantage of the applied general equilibrium (AGE) framework has been the high degree of technical expertise required for formulating and solving these models. This paper describes a micro-computer for AGE modeling. The system, named MPS/GE, combines an efficient solution algorithm with an interactive user-interface. Using MPS/GE, models containing up to 300 prices and activities can be formulated and solved on an IBM PC. This makes AGE modeling accessible to a wider group of policy analysts and educators than was previously the case. JEL Classification: 213, 214, 021 Keywords: General equilibrium, numerical, modeling, algorithm, software |
