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A Multi-Scale Spatial General Equilibrium Model Applied to the USA and France

Abstract : The creation of the C40 Cities Climate Leadership group (C40) in 2005 is a noteworthy example that the urban scale is considered as a major leeway to mitigate CO2 emissions. Nevertheless, the adequacy between this recent awareness and the number of modeling tools capable of quantifying this leeway in a spatially explicit integrated way is still missing. This thesis aims at bridging this gap. The outcome consists of a model that incorporates general equilibrium theory with an explicit representation of space at multiple scales. The model is designed as an autonomous numerical entity connectable to any pre-existing modeling architecture. This thesis hinges around three chapters, i.e. the presentation of the model, the calibration of the model and its application to France and the USA.In the first chapter, we describe our so-called GEMSE model whose aim is to investigate the interplays between aggregate and local dimensions of economic activity while quantifying GHG emissions associated to mobility. The model is based on Urban Economics and the New Economic Geography to model on multiple spatial scales the economic development of urban areas in interaction.In the second chapter, we describe the data and calibrate the model by using, for some parameters, spatial econometric techniques. Notably, we propose a new method to specify the spatial weight matrix, operationalized by using a numerical tool developed on purpose, namely PyOKNN, independent of GEMSE. Applied to Greater Paris, the tool identifies in a tangible way some key elements of its spatial structure, and yields values for the parameters under study that are similar to those of the literature.In the third chapter, we run simulations of our model for both France and the USA. We analyze the baseline case and the impacts of two transport policies on several relevant dimensions for the long-term development of urban areas. The first measure – the decrease in private vehicle speed limitation – stimulates economic activity in a pro-environmental fashion by contracting GDP in a first phase but then allowing it to reach higher levels, resulting in a positive sum game. The second measure is the implementation of a CO2 tax to private vehicles whose collected revenues are used to finance an increase in public transport speeds. The main policy insight is that setting a price of 100€ per tonne of CO2eq represents virtually nothing once converted per commuter-kilometer and deters only marginally the use of cars. These two measures, the change in speed limitation or the recycling of the tax, encourage the use of cheaper and less polluting modes of transport, which induces a low-carbon growth.Overall, these conclusions call for policy designs that internalize distortive effects, e.g. changes in mobility habits, the reorientation of demands, unbalances in labor markets via people’s relocations and firms’ improvements in terms of economies of scale. The results can rarely be generalized in terms of magnitude from one region to another, which shows the necessity to consider local specificities as well as the framework within which they interact
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Submitted on : Thursday, May 9, 2019 - 7:04:12 PM
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Laurent Faucheux. A Multi-Scale Spatial General Equilibrium Model Applied to the USA and France. Economics and Finance. Université Paris-Est, 2018. English. ⟨NNT : 2018PESC1160⟩. ⟨tel-02124740⟩



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