Center for Global Trade Analysis

Department of Agricultural Economics, Purdue University

403 West State Street, West Lafayette, IN 47907-2056 USA

contactgtap@purdue.edu

http://www.gtap.agecon.purdue.edu

Global Trade Analysis Project

The Global Trade Analysis Project (GTAP): Data, Models and Research

Dominique van der MensbruggheCenter for Global Trade Analysis

Regional Seminar on Compilation and Application of Supply-Use Tables (SUTs) in Africa

United Nations Economic Commission for Africa (UNECA)

5-8 February 2018

Addis Ababa, Ethiopia

• Global database• Harmonized input-output tables+consistent bilateral trade flows

• Global economic model• Trade agreements (Doha, FTAs, regional integration, etc.)

• Global environmental issues• Energy, greenhouse gas emissions

• Global agreements (Kyoto Protocol, Paris Agreement)

• Interactions with trade and trade policy (e.g. border tax adjustments)

• GTAP Network• Facilitates communictions

• Promotes instruction

What is GTAP?

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• Provision of global public good

• Failure to co-ordinate leads to:• Lack of transparency in data sources/methodology

• Large deviations in databases even for same year and aggregation

• Expensive for individual agencies

• Difficult to sustain

• Minimal payoff in academic setting

• Rent seeking

• Poor documentation

• GTAP relies on Advisory Board:• Core funding

• Strategic guidance

Why the GTAP Framework?

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• Represents a snapshot of the world economy• Initial equilibrium or counterfactual to experiment simulation

• Philosophy: Find the best person in the world to do the job and sell them on it!

• GTAP establishes standards, coordinates the work and brings it altogether into ONE consistent analytical database:

• Global coverage: 141 regions, of which 121 individual countries (13 in v1!)• 57 economic sectors (37 in v1)• Bilateral trade data/shipping margins• Protection data MacMap (from ITC/Geneva and CEPII)• National databases (IO tables): national collaborators• Increasing physical data

• Energy, CO2 emissions, other GHG emissions, Land-use, Labor (for some model versions)

GTAP: the database

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• The data are key for credible policy analysis

• Broad participation: GTAP pools data development efforts, get best person in world on any given task

• Documentation

• Public availability

• Regular upgrades (latest release V9.2)• improved quality;

• Increased regional/sectoral definition; and

• Additional data, e.g. better services trade, public procurement

GTAP: Data Principles

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History of releases

Release Released Regions Sectors Base Year

GTAP 1 1993 15 37 1990

GTAP 2 1994 24 37 1992

GTAP 3 1996 30 37 1992

GTAP 4 1998 45 50 1995

GTAP 5 2001 66 57 1997

GTAP 6 2005 87 57 2001

GTAP 7 2008 113 57 2004

GTAP 8 2012 129 57 2004/2007

GTAP 9 2015 140/141 57 2004/2007/2011

GTAP10 Summer 2018 141 65 2004/2007/2011/2014

Spatial coverage—GTAP V9.2

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Composite region (20)Country (121)

RUS

CAN

CHN

USA

BRA

AUS

XNF

KAZ

XAC

XWF

IND

XEC

ARG

MNG

XCF

MEX SAU

IRN

IDN

ZAF

PER

XSU

XWS

XWS

COL

BOL

EGY

ETH

TUR

TZA

UKR

VENNGA

PAK

NAM

MOZ

XSA

FRA

ZMB

SWE

XSE

CHL

MDG

ESP

XNA

BWA

KEN

DEU

THA

FIN

POL

XOC

MAR

JPN

CMR

NOR

XSM

PRY

ITA

ZWE

GBR

NZL

NZL

ROU

VNM

MYSMYS

OMN

BLR

CIV

PHL

PHL

KGZ

BFAGIN

ECU

XER

LAO

GHA

UGA

TJK

XEF

URY

SENKHM

TUN

NPL

XEAGRC

BGR

XCB

BGD

NIC

HUN

LTU

AUT

KOR

CZE

MWI

BEN

GTM

PRT

LVA

GEO

HND

IRL

JOR

AZE

ARE

ARM

EST

HRV

SVKXEE

DNK

PANLKA

CHE

TGO

DOM

CRI

NLDBEL

TWN

XSC

XSC

ALB

SVN

ISR

XCA

RWA

SLV

KWT

QAT

CYP

PRIJAM

BRN

TTO

LUX

MUS

SGP

BHR

MLT

HKG

XTW

Northern Year(s) Eastern Year(s)

1 Egypt 2003 13 Ethiopia 2002

2 Morocco 2004, 1990 14 Kenya 2001

3 Tunisia 2005, 1995 15 Madagascar 1999

16 Malawi 2007, 1994

Western 17 Mauritius 1997

4 Benin 2003 18 Mozambique 2007, 1995

5 Burkina Faso 2005 19 Rwanda 2006

6 Cameroon 2003 20 Tanzania 2007, 1992

7 Côte d’Ivoire 1998 21 Uganda 2007, 2002, 1992

8 Ghana 2005 22 Zambia 2007, 1995

9 Guinea 2005 23 Zimbabwe 1991

10 Nigeria 2006, 1999

11 Senegal 2005, 1996 Southern12 Togo 2006 24 Botswana 1994

25 Namibia 2004

26 South Africa 2005, 1995

26 African countries included in GTAP

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Eastern Middle Northern Western

Burundi Angola Algeria Cape VerdeComoros Central African Rep. Libya GambiaDjibouti Chad Western Sahara Guinea-BissauEritrea Congo Sudan LiberiaMayotte Congo, DR MaliSeychelles Equatorial Guinea Southern MauritaniaSomalia Gabon Lesotho Niger

São Tomé & Príncipe Swaziland Saint HelenaSierra Leone

31 African countries not included in GTAP

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Top countries missing from GTAP (by GDP and Population)

Algeria

Angola

Congo, Democratic Republic

Iraq

Libya

Sudan

Syrian Arab Republic

Uzbekistan

Yemen, Rep

GTAP's Most Wanted Tables

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Sectoral coverage

Paddy rice Coal Wood products Electricity

Wheat Oil Pulp, paper etc. Gas distribution

Other cereals Gas Refined oil etc. Water

Vegetables & fruits Other minerals Chemicals etc. Construction

Oil seeds Red meat Other mineral prod. Trade

Sugar cane & beet White meat Ferrous metals Land transportation

Plant-based fibers Vegetable oils Other metals Sea transportation

Other crops Dairy products Metal products Air transportation

Beef etc. Processed rice Mot. vehicles & parts Communication

Poultry, pork, etc. Refined sugar Other trp. eqpt. Financial services

Raw milk Other food Electronic eqpt. Insurance

Wool etc. Beverages & tobacco Other mach. & eqpt. Other bus. services

Forestry Textiles Other manu. Recr. & other serv.

Fishing Clothing Public services

Leather products Dwellings

Endowments

GTAP acronym Definition

off_mgr_pros

Skill

ed

Legislators, senior officials and managers (1), and

professionals (2)

tech_aspros Technicians and associate professionals (3)

clerks Clerks (4)

service_shopU

nskill

ed Skilled agricultural and fishery workers (6), craft and

related trade workers (7), plant and machine operators and

assemblers (8), and elementary occupations (9)

ag_othlowsk Skilled agricultural and fishery workers (6)

captl Capital

landr Land (in agriculture only)

natrs Forestry, fishing, coal, oil & gas extraction, and other

mining

Key data relations and dimensions

ACT VA HH GOV INV ROW

ActivitiesInt. demand

2 x 57 x 57

Private expend.

2 x 57 x 1

Public expend.

2 x 57 x 1

Inv. expend.

2 x 57 x 1

Exports FOB +

ITT

57 x 141

Value addedFactor demand

8 x 57

HouseholdsIncome dist.

1 x 8

Government

2 x 57 x 57

8 x 57

1 x 57

2 x 141 x 57

2 x 57 x 1

12 x 57 x 1 2 x 57 x 1

Investment Private savings Public savings Foreign savings

Rest of the WorldImports CIF

141 x 57

• SUT or SAM provide the country detail• transformed into IO tables

• Bilateral trade data• Reconciled based on COMTRADE (with CIF/FOB wedges)

• National Accounts• GDP, C, G, I from World Bank and others

• Detailed information• Energy (IEA), Agriculture (OECD,FAO)

• FIT procedure• Reconcile country/region table given data above and FOR A GIVEN YEAR

IN USD

Database Key Inputs

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Database Construction Process

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I-O Tables

Fitted I-O

Tables

GTAP Data

Base

International

Data SetsFIT

Assemble

• S-U, SAM, or I-O tables are contributed by users like you!

• Structural requirements of tables

• Commodity-by-commodity or product-by-product

• 2 use matrices: Tax-free (UF) and commodity tax paid (UP)

• 2 vectors: duty-free imports (MF) and indirect tax-paid output (OP)

• Requirements• Full GTAP sectors not required, at least 30; must separate food and

agriculture, energy, other

• No negative flows: since we deal with pre and post tax matrices, except changes in stocks

Country Data

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Matrices format and balance condition

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Primary

Imported

DomesticIntermediate

usage

Fin

al

Intermediate

usageF

inal

Value added

UF (tax-free)

Primary

Imported

Domestic Intermediate

usage

Fin

al

Intermediate

usage

Fin

al

Value added

UP (tax-paid)

To

tal S

ale

s

Total Costs

Production Tax

• If you don’t like it, help fix it!

• Free copy of final releases

• Include pre and interim releases

• How to Contribute to GTAP?

• Find a country for which GTAP needs new data

• Follow instructions in GTAP Tech. Paper No. 1,

https://www.gtap.agecon.purdue.edu/databases/contribute/default.asp

• Send questions, table and documentation to Angel Aguiar at the Center

Why Contribute?

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• Core model: Corong et al. 2017, (J. of Global Economic Analysis):• Relatively standard, multi-region GE model

• Perfect competition

• Armington treatment of import demand (two-nested)

• International trade and transport margins

• Modeling of global savings/investment behavior

• Analytical welfare decomposition implemented empirically

• Fully documented, easy to use and easy to modify

• Extensions include:• Technology spillovers

• Energy, power, emissions and climate change mitigation

• Biofuels, land-use

• Imperfect competition/love of variety models (incl. Melitz)

• International migration

• Recursive dynamics and international capital mobility

GTAP: the model(s)

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• GEMPACK• Typically log-linearized specification (does not impact accuracy)

• Other well-known GEMPACK versions• GTEM—ABARES (Australia), MAGNET, formerly LEITAP—Wageningen

(Netherlands)

• GAMS• Typically solved as system of non-linear equations

• Sample of well-known versions• AIM—NIES (Japan), Env-Linkages—OECD (France), EPPA—MIT (USA),

G-Cubed—McKibbin (Australia), GEM-E3—JRC (Spain), Gemini-E3—EPFL (Switzerland), FARM—USDA (USA), GLOBE (McDonald, UK), LINKAGE/ENVISAGE—World Bank (USA), MIRAGE—CEPII (France) & IFPRI (USA)

GTAP: the model(s)—Languages and dialects

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• Well established:• Evolution of FTAs

• WTO accession (used heavily for China’s accession)

• Impact of WTO agreement: Key tool for analysis of Doha

• Cost of climate change mitigation, impact on trade

• Sector trade disputes: steel tariffs, textiles and apparel quotas

• Emerging areas of application:• Technology spillovers

• FEWS (food, energy and water sustainability)

• Biofuels, land-use

• Imperfect competition/love of variety models (incl. Melitz)

• International migration

• Recursive dynamics and international capital mobility

• Public procurement

• New policy issues drive extensions to model and database

Issues addressed using GTAP

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• Core support from 29 agencies:• International: ADB (Philippines), ERIA (Indonesia), EC JRC (Spain), EC DG TRADE

(Belgium), FAO (Italy), IDB (USA), IFPRI (USA), ITC (Switzerland), OECD (France), WB (USA), UNCTAD (Switzerland), UNESCWA (Lebanon), UNECA (Ethiopia), WTO (Switzerland)

• National: CEPII (France), DRC (China), ESRI (Japan), ERS/USDA (USA), RIETI (Japan), Thünen Institute (Germany), US DOC (USA), US EPA (USA), US ITC (USA)

• Academia and private sector: Wageningen Economic Research (Netherlands), University of Hohenheim (Germany), MIT (USA), KPMG (Australia), McKinsey (USA), GRIPS (Japan)

• And supported by 3 at-large members

• Started with just 2 consortium members in 1994!

• Agencies represented on the Advisory Board• Providing core funding• and advice on future directions

GTAP: The Network, The Consortium

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• GTAP network is 16,600+ strong from 174 countries• Contributing data

• Altering the model(s),

• Writing papers and attending conferences

• Thousands of GTAP-based applications

• Discussion list—GTAP-L

• Annual conferences• 2014 Dakar, 2015 Melbourne, 2016 Washington, DC, 2017 Purdue Univ.,

2018 Cartagena, 2019 Warsaw, 2020 Tokyo

• GTAP Website (http://www.gtap.agecon.purdue.edu/)• Web is key to communication and dissemination of information

GTAP: The Network—worldwide

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Distribution of GTAP Network

24Note: As of 30 Jan 2018

Total

Network

Members

Total

Active

Contributors

Percentage

of Entire

Network

Percentage

of Active

Contributors

Entire Network

(Per Million

Inhabitants)

Active

Contributors

(Per Million

Inhabitants)

Africa 1,996 529 12.0% 12.5% 1.7 0.5

Asia 6,154 1,267 37.0% 29.8% 1.4 0.3

Europe 3,737 1,111 22.5% 26.2% 6.1 1.8

North America 3,275 948 19.7% 22.3% 5.8 1.7

Oceania 545 222 3.3% 5.2% 14.7 6.0

South America 912 171 5.5% 4.0% 2.2 0.4

Totals 16,619 4,248 100.0% 100.0%

• GTAP 101—the latest offering• Entry level course for CGE modelers

• Strictly online, offered twice a year

• Very successful with increasing enrollment and students continuing with standard GTAP short course

• GTAP short course• Oldest course, held annually

• Instruction on the GTAP database and model and related software

• Focus on analyzing and understanding model results

• 2 parts: online instruction (7 weeks), 1 week intensive hands-on instruction

• Dynamic GTAP• Normally every 2 years

• Focus on long run allocation of savings/investment

• GTAP-U• Focused courses (e.g. regional trade agreements, Melitz model)

GTAP: The Network—Education

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• GTAP is now main tool for assessing economy-wide impacts of global trade and environmental issues

• Extensive database and network of researchers

• Excellent for asking ‘what if questions’ and illustrating basic economic principles such as Comparative Advantage and Trade is a Two-way Street

• GTAP is relatively unique in economics, but likely quite similar to activities elsewhere in sciences

• Success of project traced back to Short Courses

• Consortium key to long term viability• Provides funding• But also key data inputs and leadership

• Modest contribution by many agencies provides long-run stability

Summary

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