Antonio Gómez Gómez-Plana

Simulating the effects of the European Single Market: A CGE analysis for Spain

In this paper we provide an empirical assessment of two of the measures proposed in the context of the European Single Market, namely, easing the provision of domestic and foreign services, and modifying the rules of public procurement, for the case of Spain. We build and simulate a computable general equilibrium (CGE) model, which incorporates three particular features: (i) increasing returns to scale and a noncompetitive price rule; (ii) sectoral export demand functions; and (iii) equilibrium unemployment according to a matching function approach.

Reducing Social Contributions for Unskilled Labor as a Way of Fighting Unemployment: An Empirical Evaluation for the Case of Spain

We provide an empirical evaluation of the effects of a cut in social security contributions (i) for all types of labor and (ii) only for unskilled labor, within a computable generalequilibrium model simulation of the Spanish economy. The model allows firms to follow a noncompetitive price rule, and incorporates an equal-yield assumption, which means that the reduction in social security contributions is compensated with an increase in value-added tax rates, so the public-sector deficit is not affected. In addition, the labor market is assumed to follow a matching unemployment rule, which allows us to model in a simple way any frictions present in that market.

Price-cost Margins and Economic Integration: How Important is the Pro-competitive Effect?

In this paper, we examine whether the so�?called pro�?competitive effect holds when two countries integrate by forming a common market. We propose a general framework of reference, where the price�?cost margin of domestic firms depends on a set of variables in addition to trade costs with the partner country, which might eventually offset the conventional result.

Alternative strategies to reduce public deficits: Taxes vs. spending

We examine the effects of several alternative measures intended to reduce government deficits for the case of Spain, distinguishing between those acting through taxes and through spending. The Spanish case is relevant as an example of front-loaded fiscal adjustment that has led to a large GDP fall, where (unlike the cases of Greece, Ireland and Portugal) the authorities were able to choose the composition of the adjustment measures. The empirical methodology is based on a computable general equilibrium model. All the simulated policies lead to a decrease in the levels of output and employment, and to a higher unemployment rate. The greatest contractionary effects appear in the case of an increase in the income tax, followed by spending cuts, especially in public education; in contrast, the contractionary effect is weaker for indirect tax increases. While income distribution for labour worsens with spending cuts, it slightly improves with tax increases.

Multinationals in the Czech Motor Vehicles Industry: A General Equilibrium Analysis for a Transition Economy

Abstract This study offers a computable general equilibrium methodology to analyse the involvement of multinationals in the motor vehicles sector in the post-communist Czech Republic. This allows estimating not only the economy-wide impact, but also the sectoral adjustments in a unified framework. The real levels of foreign direct investment received in the motor vehicles sector seem to produce only limited forward and backward linkages. Therefore, gross domestic product (GDP) and welfare increase slightly—and can even fall—after a certain degree of capital accumulation because saturation effects arise. Profit repatriation considerably exacerbates the negative effect on GDP and welfare.

A Decomposition of the Energy Intensity Change in Spanish Manufacturing

The excessive consumption of energy has become a major economic and environmental concern in many countries over the last two decades. A country’s energy performance is typically proxied by the rate of aggregate energy intensity, calculated as the ratio of energy consumed to GDP. The index number decomposition analysis is the usual approach to analyze the changes in a country’s aggregate energy intensity. In this paper we analyze the energy intensity change as well as the energy efficiency change by combining the index decomposition analysis approach with non-parametric frontier efficiency methods. We apply this framework to decompose and analyze the sources of the change observed in the energy intensity of Spanish manufacturing industries during the period 1999–2007.