Validating energy-oriented CGE models

摘要: Although CGE models have received heavy usage, they are often criticized as being insufficiently validated. Key parameters not econometrically estimated, and the performance of model a whole is rarely checked against historical outcomes. As consequence, questions frequently arise to how much faith one can put in results. In this paper, we employ novel approach validation widely utilized global – GTAP-E. By comparing variance generated petroleum price distributions -- driven by demand supply shocks model-- with observed five-year moving average distributions, conclude that energy GTAP-E far too price-elastic over time frame. After incorporating latest econometric estimates elasticities, revisit question find perform more satisfactorily. further check, compare deterministic general equilibrium simulation, based on realizations 2001-2006 period during which prices rose sharply, along growing demands. anticipated stochastic simulations, revised better than original global, context.