Reductions in greenhouse gas emissions are essential to reducing the rate and scale of anthropogenic climate change to levels that can sustain the planet's biosphere. A carbon tax is a policy measure that is designed to reduce greenhouse gas emissions by increasing the prices of the highest carbon polluting goods and services in an economy, thus encouraging substitution towards resultant relatively cheaper and less-polluting goods where possible. When Australia introduced such a tax in 2012, there was a fear that it could threaten the resources boom, considered the engine of Australian economic growth in recent years. By employing a computable general equilibrium model and an environmentally-extended Social Accounting Matrix, this paper demonstrates the effects of a carbon tax on the resources sector. The modelled results show that, in a flexible exchange rate regime, all resources within the sector will be affected negatively but to different degrees. The brown coal sector will be the hardest hit, with a 25.74 per cent decrease in output, 52.94 per cent decrease in employment and 89.37 per cent decrease in profitability. However, other resources in the sector would be only mildly affected. From the point of view of sustainability, the most significant results are that, under the carbon tax, the resources sector contributes considerably to the carbon emission reduction target of Australia. Given that brown coal accounts for only a small portion of the resources sector, it is reasonable to suggest that a carbon tax would not significantly affect the overall performance of the sector.

As a city state and an export-oriented economy, Singapore constantly experiences labour shortages. Although Singapore government tackles this problem by an encouraging migrant worker policy, labour constraint imposes a serious threat to the sustainable growth of the Singapore economy. This study employs the updated Singaporean input-output tables and a Computable General Equilibrium (CGE) model to gauge the long-run effects of a negative shock in labour supply as well as selected three policy responses. The simulation results suggest the effectiveness of all proposed reactions: while an increase in capital and a change in economic structure largely offset the negative effect of labour supply shock, an increase in technological efficiency induces sizeable economic growth.

The establishment of Free Trade Agreements (FTAs) has become an integral part of Australia’s current trade policy. Australia has signed FTAs with Singapore, Thailand and the US. Possibilities for similar agreements with the Association of South East Asian Nations(ASEAN), China, and Japan are being explored. This paper examines the effects of FTAs on the Australian economy and on the trading partners, drawing lessons from simulations of a number of free trade agreements. The simulations are undertaken using the Global Trade Analysis Project (GTAP) model. By simulating the GTAP multi-country computable general equilibrium (CGE) model, the paper provides quantitative evidence concerning the welfare impact of FTAs withspecial reference to trade creation and trade diversion. Examining responses of various production sectors identifies the structural changes that may take place in the economy over the long run. Thefindings may shed light on the debate over the potential incentives to participate in multilateral trade liberalization.

The global financial crisis (GFC) began four years ago, but the world economy is still in its shadow. The sluggishness of the economic recovery in the US and the recurrences of the European debt crises destroy the confidence of investors as well as consumers. "Double dip" appears as a threat from time to time. Under these circumstances, it is imperative to understand fully the impact of the GFC and the effectiveness of various policy responses to it. Using the GTAP model, the GTAP database version 7 and macroeconomic data, this paper will gauge the impact of the GFC on emerging markets. The paper also reports the simulation results assessing the effect of policy responses. By analyzing the simulation results, this paper will shed light on the contributing factors of the GFC and the efficient ways to cope with a large negative economic shock like the GFC.

In July 2012, the Australian government introduced a price on carbon at an initial price of $23 per tonne. Despite the detailed modelling undertaken by the Commonwealth Treasury, there has been continuing speculation about the economic impact of the carbon tax in Australia. In this paper we build a computable general equilibrium (CGE) model incorporating many new features to model the impact of carbon taxes and to deal with the issue of emissions. The analysis is undertaken by simulating the impact of a carbon tax of $23 a tonne and reveals some interesting outcomes. For example, in the short run, Australias real GDP declines by 0.68%, consumer prices rise by 0.75%, and the price of electricity increases by about 26% as a result of the tax. Nevertheless the tax allows Australia to make a substantial cut in its CO₂ emissions. The simulation results imply an emission reduction of about 12% in the first year of operation. In the absence of compensation, the tax burden is unequally distributed among household groups with low-income households carrying a relatively higher burden.

Purpose – The paper reviews recent developments in utilising computable general equilibrium (CGE) models to analyse forestry policies. The paper highlights the application of CGE modelling to deforestation and forestry issues. Design/methodology/approach – The analysis is carried out by comparing different CGE models available in the literature, which have analysed the economic consequences of deforestation and changes in forestry policies. Findings – The use of CGE models in analysing forestry issues is still in its early stages. There is room for innovation and improvement in the various models used. Practical implications – The paper emphasises the relevance of general equilibrium analysis in the evaluation of both micro- and macro-economic policies on forestry. It encourages researchers to use general equilibrium analysis in their study of environmental problems. Originality/value – The paper highlights the contribution and possible benefits of utilising CGE models in analysing environmental problems such as deforestation, especially in the context of environment-economics trade-off.

This paper presents some of the key features of Australia's energy sector with respect to its contribution to the economy, greenhouse gas emissions and how the energy sector has challenged all past and present government to developing an effective mitigation policy. This is mainly because Australia produces world's cheapest electricity with very high emissions intensive carbon bearing fossil energy sources.The high emission intensive energy use is one of the major reasons for Australia to be highlighted as the highest percapita emitting nation in the world, although, Australia produces less than 1.5 percent of the world's greenhouse gas emissions. As a result energy sector has played a key role in deciding Australia's emission mitigation policy framework that has been successfully implemented in July 2012.

The declining regional demand for Singapore's exports due to contraction in the crisis economies, slower growth in real investment, and loss of competitiveness in the face of competitive devaluations posed new challenges for Singapore which must adopt policies to combat the crisis. This paper examines the impact of the crisis on Singapore and the effects of proposed policies using the computable general equilibrium (CGE) modelling approach. We use two CGE models: a world model and a model of Singapore. First, the impact of the crisis is simulated using the GTAP (Global Trade Analysis Project) model. Then the effects of policy responses are examined using the Singapore model. In particular, we examine wage reduction, domestic demand stimulation, and exchange rate policies.