Exploring the Impact of Agricultural Price and Trade Policy Reform under Transition in Albania
Agricultural policy decision making in economies undergoing transition to market is in need of empirical tools for assessing the impact of alternative policy options. The econometric means available for such exercise, however, are limited for lack of data and structural breaks in economic behaviour. Synthetic, partial equilibrium, multi-market models offer a potential alternative. Such models have been used extensively, even in advanced economies, to offer valuable insights on the impact of alternative policy options. This paper shows the use of such a partial equilibrium, multi-market, synthetic-type model as a tool for agricultural policy analysis in a country in transition. The model is applied for Albania, a predominantly agricultural country that, after a period of centralism and autarky, aims to re-join the international economic system. The model, albeit its many limitations, offers some useful insights on the impact of alternative options available for agricultural price and trade policy.
Production Structure, Technical Change, and Productivity Growth in Albanian Agriculture
Abstract This paper analyzes the production structure, technical change, and total factor productivity of Albanian agriculture during the postwar period. Albanian agriculture faced severe structural problems such as limited economies of scale, labor-using technical change, decreasing partial factor (land and labor) productivities, and slow growth of total factor productivity. Agricultural development in Albania was based mainly on input increases, which accounted for almost 90% of output growth. Consequently, the economic crisis appearing since 1990 is not due only to the adjustment process toward a market economy but has also been affected by the postwar agricultural development strategy.
Mending the family tree a reconciliation of the linearization and levels schools of AGE modelling
This paper offers a critical comparison between the North American levels school of applied general equilibrium modelling and the Norwegian/Australian school of linearizers. The paper develops both the levels and linearized representations of a neoclassical, multiregion trade model. This development is used to focus attention on similarities and differences between the two schools. The main conclusions are as follows. i) The method used to solve applied general equilibrium models is not really the issue - the solution method used has become short-hand for a host of cultural differences reflecting the orientation of the two groups. ii) Levels or linearized versions of models are equally valid representations. Either representation is a natural starting point for obtaining accurate solutions of the model. iii) Linearized versions ofter aid transparency in explaining the mechanisms at work in a model. iv) In view of recent developments with the GEMPACK software suite, it is no longer necessary for linearizers to settle for solutions containing linearization errors. v) The two schools have a great deal in common and both would benefit from greater cooperation.