A General Equilibrium Model of the World Wool Market

This paper presents the theoretical and numerical structure of WOOLGEM – a general equilibrium model of the world wool market which treats raw wool, wool textiles and wool garments as heterogeneous commodities. The model divides the world wool market into nine geographical regions and production in each region amongst eight major industrial sectors, seven of which represent different production stages for wool and one representing the nonwool economy. The wool industrial sectors cover the full spectrum of activities from the production of greasy wool to wool garments. We use WOOLGEM to quantify the effects on Australian wool producers’ welfare of industry levies used to fund research and development at different stages of the wool chain.

[1]  K. Clements,et al.  The Demand for Vice: Inter-Commodity Interactions with Uncertainty , 2006 .

[2]  V. Mukerji,et al.  A Multisectoral Study of Economic Growth , 1963 .

[3]  D. J. Menkhaus,et al.  Supply Response in the U.S. Sheep Industry , 1989 .

[4]  J. Alston,et al.  Distribution of Research Gains in Multistage Production Systems: Comment , 1983 .

[5]  R. Jha,et al.  An analysis of technological change, factor substitution and economies of scale in manufacturing industries in India , 1993 .

[6]  E. Oczkowski.  A Disequilibrium Econometric Model of the Australian Raw Wool Market , 1997 .

[7]  Henri Theil,et al.  The system-wide approach to microeconomics , 1980 .

[8]  John Duffy,et al.  A Cross-Country Empirical Investigation of the Aggregate Production Function Specification , 2000 .

[9]  John Zeitsch,et al.  Fibre Substitution in the United Kingdom Worsted Spinning Sector , 1992 .

[10]  G. Holloway.  Distribution of Research Gains in Multistage Production Systems: Further Results , 1989 .

[11]  J. Alston,et al.  THE IMPACT OF FARM AND PROCESSING RESEARCH ON THE AUSTRALIAN WOOL INDUSTRY , 1989 .

[12]  K. R. Pearson,et al.  Computing solutions for large general equilibrium models using GEMPACK , 1996 .

[13]  B. Layman.  A Structural Model of the World Wool Market , 1999 .

[14]  J. Alston,et al.  Reversal of Fortune: Immiserizing Technical Change in Agriculture , 1992 .

[15]  R. Tyers,et al.  Price elasticities in international food trade: synthetic estimates from a global model , 1989 .

[16]  S. Beare,et al.  Substitution between wools of different fibre diameter. , 1990 .

[17]  Robert McDougall,et al.  Global trade, assistance, and production : The GTAP 5 Data Base , 2002 .

[18]  A. Woodland,et al.  Estimation of Australian Wool and Lamb Production Technologies under Uncertainty: An Error-Components Approach , 1995 .

[19]  R. Bellman,et al.  Linear Programming and Economic Analysis. , 1958 .

[20]  K. Salhofer.  Elasticities of Substitution and Factor Supply Elasticities in European Agriculture: A Review of Past Studies , 2000 .

[21]  K. Clements,et al.  The Economic Theory of the Consumer , 1995 .

[22]  J. Freebairn,et al.  The Gains from Research into Tradable Commodities , 1984 .

[23]  Peter B. Dixon,et al.  Notes and problems in applied general equilibrium economics , 1992 .

[24]  H. Theil,et al.  Applied demand analysis : results from system-wide approaches , 1987 .

[25]  G. Verikios,et al.  The Structure of the FTAP Model , 2000 .

[26]  J. Freebairn,et al.  Distribution of Research Gains in Multistage Production Systems , 1982 .

[27]  Modelling the effects of implementing the Uruguay Round: A comparison using the GTAP model under alternative treatments of international capital mobility , 2007 .

[28]  Mark Horridge,et al.  The Theoretical Structure of MONASH-MRF , 1996 .