MPIA-10004 Fiscal Policy Design in South Africa : An Intertemporal CGE Model with Perfect Foresight


In recent years, computable general equilibrium (CGE) models have been used increasingly to analyze the effects of trade policies. CGE models can be static or dynamic, with dynamic models taking into consideration changes that ensue with the passage of time. While static CGE models continue to be the predominant tool of trade policy analysis, the use of dynamic CGE models is spreading. Such models can be particularly useful in identifying transitional changes (e.g., phased implementation of a policy reform) or effects of trade liberalization on economic growth and development. The major theme of this paper is with identifying transitional changes of trade policy reform. Using South Africa as a case study, we demonstrate numerically the effects of trade liberalization which is anticipated as being phased in over several periods to one where agents are taken by surprise in a once-and-for-all manner. Such commercial policy scenarios embody inherent dynamics and generate interesting time profiles of adjustment which we hope to identify with the aid of the model.


Project leader: Ramos Mabugu

Project researchers: Margaret Chitiga | Charles Nhemachena | Wellington Jogo

Journal publication

Authors Co-Authors Title of paper Title of Economic Review Bibliographic references
Ramos Mabugu Margaret Chitiga Is increased agricultural protection beneficial for South Africa? Economic Modeling

(2008) Elsevier, 26:1, 256-265, January.

Working Papers

No working papers.

Policy Briefs

No policy briefs.

Final report

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2006-09-14 590 KB 1 1


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2004-09-23 275 KB 0 0

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