The World Bank Development Prospects Group (DECPG) has developed a tool for economy-wide, country-level analysis of medium- and long-run development policies, including strategies for reducing poverty and achieving the Millennium Development Goals (MDGs). The tool – named MAMS (Maquette for MDG Simulations) – is a dynamic Computable General Equilibrium (CGE) model that has been extended to cover the generation of outcomes in terms of growth, MDGs, and the educational make-up of the labor force, as well as the interaction of these outcomes with other aspects of economic performance. For a one-page summary of the MAMS approach to MDG analysis, see p. 4 in the October 2012 issue of MDGs and Beyond, a newsletter issued by the Development Prospects Group.
The government policies that are considered include:
- spending: its level and allocation across different areas (including education, health, and infrastructure);
- financing: policies for taxation, domestic and foreign borrowing, and foreign aid.
Economic performance is measured by the evolution of:
- poverty and other MDG targets;
- macro indicators:
- GDP (split into private and government consumption and investment; exports; imports);
- the composition of the government budget, the balance of payments, and the savings-investment balance;
- total factor productivity;
- domestic and foreign debt stocks.
- sectoral structure of production, employment, incomes, and trade;
- the labor market: unemployment; educational composition of the labor force.
MAMS is a flexible tool that can be run in different versions that differ in data needs. For example, for analysis of macro issues, it is sufficient to use a version with minimal data needs; analysis of MDG strategies requires a version with additional sectoral disaggregation and a more detailed database.
This program note (192 KB), prepared by Hans Lofgren, provides background information on the program.
We gratefully acknowledge support for this work from the Knowledge for Change Program (KCP) Trust Fund through the projects "Poverty reduction and human development: Analysis of alternative strategies within an economywide framework" and “Micro simulations of poverty reduction and service delivery in a user-friendly, economy-wide framework.”
The Newsletter "KCP Perspectives" of January 2012 includes a story on the MAMS experience (pp. 3-4).
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For additional information, please consult:
Bourguignon, Francois, Carolina Diaz-Bonilla, and Hans Lofgren. 2008. "Aid, service delivery and the Millennium Development Goals in an economy-wide framework" (2.59 MB) World Bank Policy Research Paper no. 4683. Washington, D.C. Also pp. 283-315 in François Bourguignon, Luiz Pereira da Silva, and Maurizio Bussolo, eds., The impact of economic policies on poverty and income distribution - Macro-Micro Evaluation Techniques and Tools. New York: Palgrave.
Lofgren, Hans and Carolina Diaz-Bonilla. 2010. "MAMS: An Economywide Model for Development Strategy Analysis" (774 KB). Draft June 10. World Bank. A similar paper in 1Spanish is found in: Lofgren, Hans y Carolina Díaz-Bonilla. 2008. "MAMS: Modelo de Equilibrio General para el Análisis de Estrategias de los ODM—una aplicación para América Latina y el Caribe". Capítulo 3 en Políticas Públicas para el Desarrollo Humano: ¿Cómo lograr los Objetivos de Desarrollo del Milenio en América Latina y el Caribe? Editado por Rob Vos, Enrique Ganuza, Hans Lofgren, Marco V. Sánchez y Carolina Díaz-Bonilla. PNUD — ONU/DAES — Banco Mundial — ONU/CEPAL. There is also a preliminary Arabic version available.
Lofgren, Hans. 2009. Simplified Mathematical Statement for MAMS (156 KB). Unpublished. June 10.
Lofgren, Hans, 2009. Development Strategy Analysis with MAMS: Model Structure and Policy Insights (597 KB). Presentation prepared with Carolina Diaz-Bonilla for the South Africa National Treasury Symposium, "Economy-wide Analysis and Economic Policy," held May 28-29, 2009, in Kievits Kroon, South Africa.
"MAMS: A Tool for Public Finance and Development Strategy Analysis" (1.33 MB). Presentation by Hans Lofgren, offered as part of the "Public Finance Analysis and Management Core Course," PREM Learning Week, April 23, 2008.
Introduction to Fiscal Policy Analysis with MAMS (1.1 MB). One-day course offered by Hans Lofgren and Carolina Diaz-Bonilla for PREMED. March 13, 2008.
"MDG Strategy Analysis: Issues, Methods and Agenda for Future Work." (260 KB) Presentation by François Bourguignon (prepared together with Hans Lofgren and Jeff Lewis) at meeting on Approaches to MDG Analysis Organized by the Poverty Group, Bureau for Development Policy, UNDP, held in New York, August 15, 2006.
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On this page, we provide links to selected other resources relevant to country-level -development strategy analysis with a focus on MDGs as well as links to other websites with more materials.
Burfisher, Mary E.. 2011. Introduction to Computable General Equilibrium Models. New York: Cambridge University Press.
Dervis, Kemal, Jaime de Melo, and Sherman Robinson. 1982. General Equilibrium Models for Development Policy World Bank Research Publication, Report no. 10173. Washington, D.C.: World Bank.
Francois, Joseph F., and Kenneth A. Reinert. 1998. Editors. Applied Methods for Trade Policy Analysis: A Handbook. New York: Cambridge University Press.
Hosoe, Nobuhiro, Kenji Gasawa, and Hideo Hashimoto (2010). Textbook of Computable General Equilibrium Modeling: Programming and Simulations. New York: Palgrave MacMillan.
Lofgren, Hans. 2003. Exercises in General Equilibrium Modeling Using GAMS. Microcomputers in Policy Research, Vol. 4a. Washington, D.C.: IFPRI.
Lofgren, Hans. 2003. Key to Exercises in General Equilibrium Modeling Using GAMS. Microcomputers in Policy Research, Vol. 4b. Washington, D.C.: IFPRI
Lofgren, Hans, Rebecca Lee Harris, and Sherman Robinson, with assistance from Moataz El-Said and Marcelle Thomas. 2002. A Standard Computable General Equilibrium (CGE) Model in GAMS. Microcomputers in Policy Research, Vol. 5. Washington, D.C.: IFPRI.
Robinson, Sherman and Hans Lofgren. 2008. Economy-Wide Models and Poverty Analysis. Presentation delivered by Sherman Robinson at the WIDER Conference “Frontiers of Poverty Analysis,” held in Helsinki, Finland, September 26-27.
Robinson, Sherman, Antonio Yunez-Naude, Raul Hinojosa-Ojeda, Jeffrey D. Lewis, and Shantayanan Devarajan. 1999. "From stylized to applied models: Building multisector CGE models for policy analysis." North American Journal of Economics and Finance, Vol. 10, pp. 5–38.
TIPS (Trade and Industrial Policy Strategies), Pretoria, South Africa. Downloadable materials used for the 2007 "Introductory Course on Computable General Equilibrium Modeling", offered by Dirk Ernst van Seventer and Rob Davies.
van der Mensbrugghe, Dominique. 2005. Prototype Model for a Single Country Real Computable General Equilibrium Model. Development Prospects Group, World Bank.
Links to related World Bank materials
Data and Research. Entry point to main World Bank unit for development economics, divided into Data, Research, and Prospects.
Poverty Reduction and Economic Management Network. Entry point to the Bankwide network, divided into Poverty Reduction, Economic Policy and Debt, Public Sector Governance, Trade, Gender and Development, and Global Development Architecture
Millennium Development Goals (MDGs). Data and links to resources on the MDGs.
Global Monitoring Report. Annual report on the MDGs produced by the World Bank and the International Monetary Fund (IMF).
Documents and Reports. Search engine providing access to World Bank documents classified by country and region.
The site Poverty and Social Impact Analysis provides information about selected tools for the analysis of the impacts of reforms.
The Human Development (HD) Network provides resources on health, education and other HD areas, including materials relevant to Public Expenditure Reviews.
Links to external organizations
EcoMod Network. The Network, which is global, promotes model-based policy analysis. Among other things, website provides information about its activities, including courses and conferences.
General Algebraic Modeling System (GAMS). MAMS and many other CGE models are written in GAMS, a system for mathematical programming and simultaneous equation modeling. The website of the GAMS Development Corporation provides access to documentation, manuals and the software (a license is required to be able to solve anything but small models).
Global Trade Analysis Project (GTAP). GTAP is a global collaborative network that promotes model-based policy analysis and database development, both global and at the country level. Its website is an excellent source of data, documents and research outputs.
International Food Policy Research Institute (IFPRI). The IFPRI website provides access research in the food policy area. Of particular interesty for economywide modeling are the Discussion Papers of the Trade and Macroeconomics Division and IFPRI's repository of Social Accounting Matrices (SAMs).
Poverty and Economic Policy (PEP) Research Network. PEP promotes research by developing country researchers working to reduce poverty. Its Modeling and Policy Impact Analysis (MPIA) network provides access to working papers, training materials, and software related to country-level macro-micro analysis, including a family of standard CGE models.
Scott McDonald, of Oxford Brookes University, and Karen Thierfelder of the US Naval Academy provide a website with materials related to GAMS-based single-country and global CGE modeling.
The Development Policy Analysis Division (DPAD) of the UN Department of Economic and Social Affairs (DESA) maintains a webpage for Capacity Development Publications, focused on applications macro-micro modeling, linking CGE models (including MAMS) to microsimulation models, including documents in Spanish.
Thomas Rutherford, of the University of Colorado in Denver, has developed numerous tools that facilitate GAMS-based modeling.
United Nations' provides a gateway to its work on the Millennium Development Goals (MDGs).
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