Model Solution
Model Solution
This chapter describes the construction and simulation of the IGEM base case, illustrating how the various components of the model combine to achieve the economy's growth path. Key projections for variables external (exogenous) to IGEM are developed for: (i) population, time endowment, labor quality and household demographics from Census Bureau projections; (ii) government deficits, expenditures and tax rates from CBO 10-year and 75-year projections; (iii) current account deficits from IMF short-term forecasts; (iv) world energy prices from EIA projections. Projections of productivity-related variables and trends are derived from IGEM's underlying econometrics. Also described is the procedure by which IGEM's productivity terms are used to target energy consumption patterns and real GDP for those applications requiring calibrated base cases and cross-model comparisons. Base case (endogenous) results are reported at both the macroeconomic and industry levels of detail and for both uncalibrated and calibrated simulations.
Keywords: model solutions, population-related projections, fiscal policy projections, trade policy projections, world price projections, productivity-related projections, macroeconomic performance, industry performance, model calibration
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