$TITLE Model M24: Closed Economy 2x2 with Specific Factors $ONTEXT Here is the initial data matrix for example M21 (also M1_MPS). As noted in the text description, it is technically useful to interpret a portion of capital in each sector as sector specific. Or it can in fact be a separate factor such as land or resources. Production Sectors Consumers Markets | X Y W | CONS ------------------------------------------------------ PX | 100 -100 | PY | 100 -100 | PW | 200 | -200 PL | -25 -75 | 100 PK | -75 -25 | 100 ------------------------------------------------------ Designate part of the capital in each sector as fixed in that sector Production Sectors Consumers Markets | X Y W | CONS ------------------------------------------------------ PX | 100 -100 | PY | 100 -100 | PW | 200 | -200 PL | -25 -75 | 100 PK | -50 -15 | 65 PKX | -25 | 25 PKY | -10 | 10 ------------------------------------------------------ $OFFTEXT PARAMETERS TX; TX = 0; $ONTEXT $MODEL:M24 $SECTORS: X ! Activity level for sector X Y ! Activity level for sector Y W ! Activity level for sector W (Hicksian welfare index) $COMMODITIES: PW ! Price index for welfare (expenditure function) PX ! Price index for commodity X PY ! Price index for commodity Y PL ! Price index for primary factor L PK ! Price index for (mobile) capital PKX ! Price index for sector-specific input for sector X PKY ! Price index for sector-specific input for sector Y $CONSUMERS: CONS ! Income level for consumer CONS $PROD:X s:1 O:PX Q:100 I:PL Q: 25 A:CONS T:TX I:PK Q: 50 A:CONS T:TX I:PKX Q: 25 A:CONS T:TX $PROD:Y s:1 O:PY Q:100 I:PL Q: 75 I:PK Q: 15 I:PKY Q: 10 $PROD:W s:1 O:PW Q:200 I:PX Q:100 I:PY Q:100 $DEMAND:CONS D:PW Q:200 E:PL Q:100 E:PK Q:65 E:PKX Q:25 E:PKY Q:10 $OFFTEXT $SYSINCLUDE mpsgeset M24 $INCLUDE M24.GEN SOLVE M24 USING MCP; * Solve a counterfactual: TX = 0.5; $INCLUDE M24.GEN SOLVE M24 USING MCP;