Parameter uncertainty in CGE modeling of the environmental impacts of economic policies

David G. Abler, Adrián G. Rodríguez, James S. Shortle

Research output: Contribution to journalArticlepeer-review

43 Scopus citations

Abstract

This study explores the role of parameter uncertainty in CGE modeling of the environmental impacts of macroeconomic and sectoral policies, using Costa Rica as a case for study. A CGE model is constructed which includes eight environmental indicators covering deforestation, pesticides, overfishing, hazardous wastes, inorganic wastes, organic wastes, greenhouse gases, and air pollution. The parameters are treated as random variables drawn from prespecified distributions. Evaluation of each policy option consists of a Monte Carlo experiment. The impacts of the policy options on the environmental indicators are relatively robust to different parameter values, in spite of the wide range of parameter values employed.

Original languageEnglish (US)
Pages (from-to)75-94
Number of pages20
JournalEnvironmental and Resource Economics
Volume14
Issue number1
DOIs
StatePublished - Aug 12 1999

All Science Journal Classification (ASJC) codes

  • Economics and Econometrics
  • Management, Monitoring, Policy and Law

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