A CGE Model for Denmark Applied to C02 Targets and GATT Liberalizations

The Secretariat of the Danish Economic Council has developed a CGE (Computable General Equilibrium) model of the Danish economy, GESMEC (General Equilibrium Simulation Model of the Economic Council), to calculate the long run costs for Denmark of various C0₂ reduction measures and Danish gains from international GATT liberalization scenarios. In most scenarios analysed it is an implicit assumption that changes in environmental and agricultural policies are gradually phased in so that the economy will have sufficient time to adapt fully1.