INGENUE Model (Cepii - Cepremap - Ofce)

1
INGENUE Model (Cepii - Cepremap - Ofce)

• Pension Reforms Simulations in a world general
  Equilibrium Model with overlapping generations
• First look at the results

Jean Chateau (CEPII) AGIR Workshop - Berlin
April 2004
2
INGENUE Model (Cepii - Cepremap - Ofce)

• Goal of the Ingenue project
• To analyse quantitatively international capital
  flows and growth dynamics induced by differential
  ageing of the various regions of the world.
• Tool
• An applied international general equilibrium
  model with overlapping generations of rational
  households

3
Demographic Transition Ingenue 1
OECD countries
Very advanced in demographic transition
Advanced in D.T.
Ageing
Soon Ageing
Developing countries
Hypothetical ageing
4
The theoretical framework Ingenue 1
5
Dissatisfactions about Ingenue 1.

• Ageing too much generous PAYG system for Europe
  will imply and inconsistent huge net debt
  position for Europe in late 21st century not
  really consistent with perfect capital market
  assumption,
• Trade balance movements not explained by
  traditional relative productivity between
  production sectors,
• Developing countries are aggregated in an
  unsatisfactory way difficulty of interpretation
  misleading results,
• Can not free ourselves from UN population
  prospects

6
Add-ons to the theoretical framework Ingenue 2
7
add-ons (2.)
8
World Regions Ingenue 2.
Western Europe Eastern Europe North
America Japan Mediterranean World Chinese
World Africa Russian World Indian World South
America
9
Calibration and DataBase

• We have built the specific demographic projection
  model fits UN prospects for a baseline case,
• Constitution of a world and complete and
  consistent database for the calibration phase of
  the model, variables built for each aggregate
  region are . Employment rate (From ILO)
  . Aggregate macroeconomic variables (PWT
  6.2), . International Trade (IFS), .
  Capital Stock (WB).
• A 3-steps calibration procedure to reproduce past
  stylised facts and then good approximation of
  2000s variables

10
Calibration Parameters
11
Source Ingenue (2004)
12
Source Ingenue (2004)
13
Source Ingenue (2004)
14
(No Transcript)
15
(No Transcript)
16
(No Transcript)
17
(No Transcript)
18
(No Transcript)
19
(No Transcript)
20
(No Transcript)
21
(No Transcript)
22
(No Transcript)
23
(No Transcript)
24
(No Transcript)
25
(No Transcript)