$TITLE: M54-MPS.GMS. Two country oligopoly model with free entry * uses MPS/GE $ONTEXT YI YJ XI XJ NI NJ WI WJ CONI CONJ EHTI ENTJ PYI 100 -100 PYJ 100 -100 PXI 100 -50 -50 PXJ 100 -50 -50 FCI 20 -20 FCJ 20 -20 ZI -40 -48 -12 100 ZJ -40 -48 -12 100 WI -60 -32 -8 100 WJ -60 -32 -8 100 PUI 200 -200 PUJ 200 -200 MKI -10 -10 10 10 MKJ -10 -10 10 10 $OFFTEXT PARAMETERS ENDOWIL ENDOWJL ENDOWIS ENDOWJS REALWI REALWJ REALZI REALZJ TC SUBSIDY; TC = .0; SUBSIDY = 0; ENDOWIL = 1; ENDOWJL = 1; ENDOWIS = 1; ENDOWJS = 1; $ONTEXT $MODEL:M54 $SECTORS: YI YJ WFI WFJ XI XII XIJ XJ XJI XJJ NI NJ $COMMODITIES: PY PUI PUJ WI WJ ZI ZJ PXI PXJ PXDI PXDJ FCI FCJ $CONSUMERS: CONSI CONSJ ENTI ENTJ $AUXILIARY: MARKII MARKIJ MARKJI MARKJJ $PROD:YI s:1.0 O:PY Q:100.0 I:WI Q:60.0 I:ZI Q:40.0 $PROD:YJ s:1.0 O:PY Q:100.0 I:WJ Q:60.0 I:ZJ Q:40.0 $PROD:XI s:1 O:PXDI Q:80. I:WI Q:32 A:CONSI S:SUBSIDY I:ZI Q:48 A:CONSI S:SUBSIDY $PROD:XII O:PXI Q:40. A:ENTI N:MARKII I:PXDI Q:40. $PROD:XIJ s:0.0 O:PXJ Q:40. A:ENTI N:MARKIJ I:PXDI Q:(40.*(1+TC)) $PROD:XJ s:1 O:PXDJ Q:80. I:WJ Q:32. I:ZJ Q:48. $PROD:XJI O:PXI Q:40. A:ENTJ N:MARKJI I:PXDJ Q:(40.*(1+TC)) $PROD:XJJ s:0.0 O:PXJ Q:40. A:ENTJ N:MARKJJ I:PXDJ Q:40. $PROD:NI s:1 O:FCI Q:(20/2.5) I:WI Q:(8/2.5) I:ZI Q:(12/2.5) $PROD:NJ s:1 O:FCJ Q:(20/2.5) I:WJ Q:(8/2.5) I:ZJ Q:(12/2.5) $PROD:WFI s:1.0 O:PUI Q:200. I:PXI Q:80. P:1.25 I:PY Q:100. $PROD:WFJ s:1.0 O:PUJ Q:200. I:PXJ Q:80. P:1.25 I:PY Q:100. $DEMAND:CONSI D:PUI Q:200 E:WI Q:(100.*ENDOWIL) E:ZI Q:(100.*ENDOWIS) $DEMAND:CONSJ D:PUJ Q:200 E:WJ Q:(100.*ENDOWJL) E:ZJ Q:(100.*ENDOWJS) $DEMAND:ENTI D:FCI Q:20 $DEMAND:ENTJ D:FCJ Q:20 $CONSTRAINT:MARKII MARKII*NI*(XII + XJI) =G= XII; $CONSTRAINT:MARKIJ MARKIJ*NI*(XIJ + XJJ) =G= XIJ; $CONSTRAINT:MARKJI MARKJI*NJ*(XII + XJI) =G= XJI; $CONSTRAINT:MARKJJ MARKJJ*NJ*(XIJ + XJJ) =G= XJJ; $OFFTEXT $SYSINCLUDE MPSGESET M54 PXI.L = 1.25; PXJ.L = 1.25; MARKII.L = .2; MARKJI.L = .2; MARKIJ.L = .2; MARKJJ.L = .2; NI.L = 2.5; NJ.L = 2.5; PY.FX = 1.0; NI.LO = 0.0001; NJ.LO = 0.0001; *OPTION SOLPRINT=OFF; OPTION LIMROW=0; OPTION LIMCOL=0; $OFFSYMLIST OFFSYMXREF OFFUELLIST OFFUELXREF $INCLUDE M54.GEN SOLVE M54 USING MCP; * counterfactual: trade costs of 15% TC = 0.15; $INCLUDE M54.GEN SOLVE M54 USING MCP; * counterfactual: home production subsidy of 10%, trade costs 0 TC = 0.; SUBSIDY = .10; $INCLUDE M54.GEN SOLVE M54 USING MCP; * counterfactual: country's identical except for size, * positive trade costs (home market advantage) SUBSIDY = 0; TC = 0.15; ENDOWIL = 1.5; ENDOWJL = 0.5; ENDOWIS = 1.5; ENDOWJS = 0.5; $INCLUDE M54.GEN SOLVE M54 USING MCP; REALWI = WI.L/PUI.L; REALWJ = WJ.L/PUJ.L; REALZI = ZI.L/PUI.L; REALZJ = ZJ.L/PUJ.L; DISPLAY REALWI, REALWJ, REALZI, REALZJ;