A TRANSPORTATION-ORIENTED INTERREGIONAL COMPUTABLE GENERAL EQUILIBRIUM-MODEL OF THE UNITED-STATES

Interregional computable general equilibrium (ICGE) models are useful new tools for investigating questions of spatial equity and efficiency, especially if they consider the explicit costs of movement across space. In this paper, we outline a three-region, five-sector operational ICGE model of the United States which has been calibrated from a 51 region, 124 sector public data base. This model explicitly includes transportation and wholesaling services and the costs of moving products based on origin-destination pairs. Through the use of a counter-factual scenario, the ICGE's explicit specification is compared with a well known implicit method - to observe how the predicted regional production pattern is affected. The proposed explicit method is seen to provide a more focused description of the spatial economic impacts that result from changes in the production of transportation services.