earticle

영어

This study attempts to construct a regional computable general equilibrium (CGE) model to analyze the impact of increases in the import price of raw material such as oil and natural gas on the Incheon economy. The model structure is largely segmented into five equation blocks which include a regional output production and distribution block, a regional commodity production and distribution block, a household and government block, a capital market block, and a market clearing condition block. And the model is distinguished from other regional models in that interregional commodity flow is specifically incorporated in the model. In this paper, two scenarios for increasing rate of the import price of raw material are assumed. The simulation demonstrates that the 10% increase in the import price of raw material reduces GRDP of Incheon by 0.28%, raises the regional consumer price index by 0.30% and widens the Incheon's trade deficit by 4.43%.