Scandinavian Working Papers in Economics
Umeå Economic Studies,
Umeå University, Department of Economics
No 569: Endogenous Disinvestment Activities and the Transformation to a new Equilibrium. A computable general equilibrium approach
Ronny Norén ()
Additional contact information
Ronny Norén: Department of Social Sciences, Postal: Mid Sweden University, SE 831 25 östersund, Sweden
Abstract: The contribution of this book is the explicit recognitation of the importance of endogenous disinvestment activities to a new equilibrium. This is embodied in the condition specifying the economic life of capital to account for obsolescence. This specification provides the formal link between capital formation and production capacity. Thus, the transformation process will be endogenously specified in the model. In technical terms, the economic structure is illustrated by the help of a computable general equilibrium (CGE) model of an open economy. The numerical applications is an examination of the sensitivity of the model to systematic variation in key variables of the transformation process, and the variations that may appear through changes in domestic and international conditions. This book, organised in 6 chapters, is designed as a textbook and a research publication in combination. In rough outline, Chapter 2 and 3 is a pure textbook representation, and Chapter 4, 5 and 6 are representative chapters of the research publication.
Keywords: Economic obsolescence; CGE model; transformation; capital rent; open economy
90 pages, October 1, 2001
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