A Multi-regional CGE Model for China

With the development of China's economy, the regional diversity and interregional economic linkage have become more and more remarkable and been two important factors to study China's national and regional economy. Based on the multi-regional input-output table for China, this paper develops a multiregional CGE (MRCGE) model for China that is expected to provide a useful tool for analysis of regional economy and regional policies. This model depicts regional diversities on scale and structure and interregional economic linkages, i.e. commodity flow, labor flow and capital flow. As an application of this model, this paper designs to increase the investment. for Northwestern region to reveal the important effect that comes from the regional differences and linkages.