APPLY COMPUTABLE GENERAL EQUILIBRIUM (CGE) MODEL

The purpose of this work is to introduce the CGEModel and apply it to measure the impactsof production activities to the economy. Theexpansion of hog production and processing onthe economy of Texas County, Oklahoma, was used asthe case study of this model. The impacts areevaluated based on the measures of welfare.Model in the short-run show that when output of MeatPacking increases 10 times the output of Hog Productincreases 11.54 times while the changes of output ofother sectors are small, and all commodity pricesincrease. The measures of regional welfare such asGross Regional Product increases 7.21%, indirectbusiness increases 8.33% and employment increases10.74%. Results of the long-run show that output ofHog Product increases 35.04 times when output ofMeatpacking increases 30 times. Output put of OtherLivestock decreases 47% because price of mainintermediate inputs such as Feed Grains and OtherCrops increase. The incremental gain of householdincome is small but prices of necessary commoditiesdecrease cause households welfare gains from 0.34 to0.55 percent.