Econometrica: Nov, 1982, Volume 50, Issue 6

A Decomposition Algorithm for General Equilibrium Computation with Application to International Trade Models

https://doi.org/0012-9682(198211)50:6<1547:ADAFGE>2.0.CO;2-N
p. 1547-1557

Ahsan Mansur, John Whalley

In this paper we outline the computation of general equilibrium in a pure exchange economy via a fixed point decomposition procedure. For general equilibrium models of the required structure, a full equilibrium may be computed through the solution of a sequence of smaller scale `sub-equilibrium' problems. The text contains a presentation of the methods involved along with a discussion of initial computational experience for some numerical examples.