Regional development - A Computable General Equilibrium (CGE) analysis of the benefits to local residents, commuters and migrants
Abstract
Scope and Method of Study: This study uses a Computable General Equilibrium (CGE) model to estimate the impacts of local development on the original residents of the local region. The study addresses the aggregate and distributional income effects of a 50% increase in export demand for manufacturing for production in Oklahoma County, Oklahoma. The model includes nine disparate households, two labor skill types, commuters and migrants. Five simulations are used to provide a reasonable impact estimate with sensitivity analysis based on a range of commuter and migration elasticities. The study finds that local development increased local household income for all nine households regardless of commuter or migration elasticities. Findings and Conclusions: The distributional impacts were not uniform across all simulations, however, differences were relatively minor. The greatest aggregate income increase occurred when migration elasticities were decreased. Increased migration elasticities led to the smallest increase in aggregate income. Changes in commuter elasticities led to smaller changes in aggregate local household income. Commuter income was enhanced in every scenario with greater commuter elasticities resulting in greater commuter income.
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- OSU Dissertations [11222]