Economic Analysis: Theory and Practice

Equilibrium and input-output modeling of economic system stability

Vol. 17, Iss. 8, AUGUST 2018

Received: 30 March 2018

Received in revised form: 25 May 2018

Accepted: 21 June 2018

Available online: 29 August 2018


JEL Classification: B41, C02, C61, C68

Pages: 1528–1544

Duszynski R.R. National Louis University, College of Arts and Sciences, Chicago, Illinois, USA

ORCID id: not available

Toroptsev E.L. North-Caucasus Federal University, Stavropol, Russian Federation

Marakhovskii A.S. Sole Proprietor, Stavropol, Russian Federation

Importance The article presents the problem of structural stability of economic systems and its modeling. A possible solution is a complex of economic equilibrium and dynamic input-output models.
Objectives The study aims to analyze factors that are difficult-to-modeling in general, and are unmanageable while investigating problems of economic stability, in particular; develop methods to increase the validity, efficiency and practical value of equilibrium models' application for mapping various options of economic policy, its results and prospects, justify the feasibility of modeling the problems of sustainability, economic and welfare growth on the basis of a complex of computable general equilibrium models and dynamic input-output models.
Methods The article presents an analysis of two methodologies for economic systems modeling from the perspective of their integration into a complex.
Results General equilibrium models have tangible limits of applicability that are outlined by provisions of the neoclassical economic theory. They function in smoothly running and stable economies and can reproduce the fine-tuning options for such systems. The results of input-output modeling may determine the practical usefulness of agent modeling or throw discredit upon its adequacy.
Conclusions The results of equilibrium and input-output modeling complement and modify each other. A complex of two models enables to solve structural problems of economy, stability and quality of transitional processes; to develop scenarios of economic policy and assess the efficiency of its implementation.

Keywords: structural stability, CGE model, computable general equilibrium model, input-output balance


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