World Bank’s Environmental Impact and Sustainability Applied General Equilibrium ENVISAGE Model is a global dynamic computable general equilibrium (CGE) model designed to analyze a variety of issues related to the economics of climate change:
- Baseline emissions of CO2 and other greenhouse gases
- Impacts of climate change on the economy
- Adaptation by economic agents to climate change
- Greenhouse gas mitigation policies—taxes, caps and trade
- The role of land use in future emissions and mitigation
- The distributional consequences of climate change impacts, adaptation and mitigation—at both the national and household level.
ENVISAGE is intended to be flexible in terms of its dimensions. The core database—that includes energy volumes and CO2 emissions—is the GTAP database, currently version 8.1 with a 2007 base year. The latter divides the world into129 regions/countries (of which 109 are individual countries). The database divides global production into 57 sectors—with extensive details for agriculture and food and energy (coal mining, crude oil production, natural gas production, refined oil, electricity, and distributed natural gas). The core model structure is similar to LINKAGE, but Envisage includes the additional environmental module. The model is recursive dynamic capturing population and labor dynamics, differential sectoral productivity growth and the role of savings and investment in capital accumulation. The model has been used widely in the World Bank's Global Economic Prospects reports, World Bank policy papers and external publications.
For analyses of poverty, shared prosperity and the distributional impacts of policies the ENVISAGE model can be paired with the GIDD in a macro-micro simulation framework.
CGE-based Analysis at DECPG