CGE modeling and developing economies: A concise empirical survey of 73 applications to 26 countries

In the last 10 years, a proliferation of computable general equilibrium (CGE) models have been applied to developed and developing countries. CGE models have the advantage of allowing simultaneously for decentralized planning mechanisms based on price responsiveness and substitution possibilities and for non-Walrasian features existing in real economies, such as price stickiness, rationing, and technological feasibility. A review is presented of 73 applications of CGE models to 26 developing countries. The countries vary greatly in terms of living standard, degree of industrialization, relative openness to external trade, importance of the public sector, and the nature of the policies pursued. For each of the 73 applications, the survey focuses on: 1. treatment of the production, private consumption, and external trade blocks, 2. the type of macroeconomic closure and the sources of dynamization, if any, and 3. the nature and results of the simulations.